State Capacity and Institutional Structure: A Comparative Study of Railway Development in China and India.

In less than a decade, China built the world's largest high-speed rail network. In contrast, India has struggled to expand its railway network, which has become increasingly strained by rapidly growing social and economic demands. The railway sector in both countries is exclusively controlled by the state. Why does China exhibit such a high degree of state capacity for railway development compared with India? Differences in regime type and investment levels fail to fully explain this gap. Building on two years of in-depth fieldwork in China and India including interviews with state railway officials, this paper examines the institutional structures than underlie state capacity in these two countries. This paper argues that institutional structures characterized by "empowered accountability" where decision-making power and accountability are commensurate at the level of individual state actors yield higher levels of state capacity. In particular, "nodal" forms of institutional structure where authority and accountability are concentrated in key positions and state organizations exhibit greater "empowered accountability" and tend to result in relatively streamlined policy implementation. "Diffuse" forms, in contrast, tend to produce decision-making paralysis and a diffusion of responsibility. China's state railway institutions are better able to execute railway projects largely due to their nodal structure whereas the diffuse structure of India's railway institutions contributes to chronic project delays. A more detailed understanding of the relationship between institutional structure and state capacity has significant implications for improving for social well-being in developing countries. [ABSTRACT FROM AUTHOR]