Party-State Capitalism in China

Abstract

China’s economic model, commonly described as “state capitalist,” is now better characterized as party-state capitalism, in which the political survival of the Communist Party trumps developmental goals. Its tools for managing the economy include not only state ownership and market interventions, but increasing use of party-state power to discipline private capital. China’s entrepreneurs are now expected to adhere to the party line, as are foreign corporations operating in the country. The shift is fueling a backlash from foreign governments that view the fusion of state and private interests in China as a threat to their own national security.