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In Chap. 1, we suggested that the growth of the economy in China as a whole is a story of both top-down centrally managed capitalism (Lin 2009) and bottom-up grass-roots capitalism (Nee and Opper 2012). The former focused on the reform of state-owned enterprises and the attraction of foreign investment, while the latter allowed for the creation of a private economy without much policy guidance or support. Private individuals overcame extremely disadvantageous initial conditions and developed robust enterprises that became the major engine of growth for China. Nee and Opper (2012), through their five-year study of over 700 entrepreneurs in the Yangzi River Delta region, provided convincing evidence and a persuasive argument that this economic miracle is the result of the actions and ambitions of entrepreneurs. Since they could not rely on formal institutions, private entrepreneurs had to develop their own informal lending systems and networks of suppliers and distributors. They contributed a large proportion of the national GDP and provided employment as the state sector’s contributions to both declined steadily over the years. Formal institutional changes that legitimised the private firms’ existence and supported their further development came after their initial success. Private entrepreneurs, the ‘capitalists’ who were despised, scorned and viewed with suspicion in the early years of the reforms, are now legitimate members of Chinese society. Even though the sea is still turbulent and the entrepreneurs are still complaining about the difficult business environment and continued unfair treatment by the government relative to state-sector firms, their economic success is undeniable, earning social acceptance as well as raising expectations by both government and citizens of their role in contributing to a balanced economic and social development of China. Even though the future is uncertain, we can conclude from the solid results that thise resounding success can be credited to the ‘leadership’ or agency of the entrepreneurs and founders of these private enterprises. This conclusion is consistent with the ‘visible hand’ theory of the growth and development of industrial enterprises (Chandler 1978) in the West as well as the strategic choice theory of business and organisation management (Child 1972).
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- Leadership Insights from Published Studies on Chinese Top Executives
Anne S. Tsui
- Palgrave Macmillan UK
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