This paper investigates the role of bottom-up reforms in driving China's economic growth. Leveraging granular documentation from county-level gazetteers, we identify local reform events from 1976 to 2005, capturing de facto policy innovations and their diffusion. Our findings show that bottom-up reforms primarily drive growth through productivity improvements, while centrally sponsored reforms operate mainly through capital accumulation. Evidence from firm entry and structural transformation further corroborates the productivity-enhancing effects of bottom-up reforms. Notably, these reforms were more likely to originate in politically peripheral regions and the diffusion of these reforms was more driven by local conditions than centrally sponsored reforms.

Speaker: Professor Xiaodong Zhu (University of Hong Kong)

Professor Xiaodong Zhu joined the Faculty of Business and Economics at the University of Hong Kong as a professor in 2022. Prior to that, he was a professor in the Department of Economics at the University of Toronto, where he taught for 30 years. He is a leading expert on the Chinese economy and his research on China has been published in top economics journals such as the American Economic Review, Journal of Political Economy, Journal of Monetary Economics, International Economic Review, Journal of Development Economics, Review of Economic Dynamics, and Journal of Economic Perspectives.

This is an in-person seminar organised by the China Economy Program, taking place at the Lecture Theatre, CBE Building (Building 26C).