From Privatization to Deindustrialization: Implications of Chinese Rural Industry and the Ownership Debate Revisited

Summary This paper examines the evolution of Chinese rural industry since the rural reform in the late 1970s and revisits the debate on the role of ownership. Based on a case study of W county in southern Jiangsu province as well as drawing on national data, the author shows that the community-based market dynamic had been a key factor in the expansion of rural enterprises and that its weakening in recent years has led to the closing of village enterprises and deindustrialization of the countryside. Large-scale land expropriation, sponsored by local government, is the principal factor responsible for the change.