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China's Gilded Age: The Paradox of Economic Boom and Vast Corruption
Why has China grown so fast for so long despite vast corruption? In China's Gilded Age, Yuen Yuen Ang argues that not all types of corruption hurt growth, nor do they cause the same kind of harm. Ang unbundles corruption into four petty theft, grand theft, speed money, and access money. While the first three types impede growth, access money - elite exchanges of power and profit - cuts both it stimulates investment and growth but produces serious risks for the economy and political system.
Since market opening, corruption in China has evolved toward access money. Using a range of data sources, the author explains the evolution of Chinese corruption, how it differs from the West and other developing countries, and how Xi's anti-corruption campaign could affect growth and governance.
In this formidable yet accessible book, Ang challenges one-dimensional measures of corruption. By unbundling the problem and adopting a comparative-historical lens, she reveals that the rise of capitalism was not accompanied by the eradication of corruption, but rather by its evolution from thuggery and theft to access money.
In doing so, she changes the way we think about corruption and capitalism, not only in China but around the world.
Since market opening, corruption in China has evolved toward access money. Using a range of data sources, the author explains the evolution of Chinese corruption, how it differs from the West and other developing countries, and how Xi's anti-corruption campaign could affect growth and governance.
In this formidable yet accessible book, Ang challenges one-dimensional measures of corruption. By unbundling the problem and adopting a comparative-historical lens, she reveals that the rise of capitalism was not accompanied by the eradication of corruption, but rather by its evolution from thuggery and theft to access money.
In doing so, she changes the way we think about corruption and capitalism, not only in China but around the world.
266 pages, Hardcover
First published July 1, 2021
117 people are currently reading
2231 people want to read
About the author
Yuen Yuen Ang
2 books72 followersYuen Yuen Ang is associate professor of political science at the University of Michigan, where she is also a faculty associate of the Center for Chinese Studies and the Center for the Study of Complex Systems. Ang’s research aims to advance our understanding of development as a non-linear, adaptive process, using China as a primary case. Part of this agenda involves challenging the assumption that a universally best standard of institutions exists. Her work shows that normatively weak institutions can be functionally strong.
Her book How China Escaped the Poverty Trap (Cornell University Press, 2016) won the 2017 Peter Katzenstein Book Prize for “outstanding first book in international relations, comparative politics, or political economy.” It was also named by Foreign Affairs as “Best Books of 2017.”
Ang’s research has been supported by the ACLS/Andrew Mellon Foundation, Smith Richardson Foundation, Chiang Ching Kuo Foundation, among others. She has served on the United Nations Expert Group on Eradicating Poverty and is a member of the Advisory Board of Cambridge University Press’ Element Series on “The Politics of Development.” A Singapore native, she holds a PhD from Stanford University.
Her book How China Escaped the Poverty Trap (Cornell University Press, 2016) won the 2017 Peter Katzenstein Book Prize for “outstanding first book in international relations, comparative politics, or political economy.” It was also named by Foreign Affairs as “Best Books of 2017.”
Ang’s research has been supported by the ACLS/Andrew Mellon Foundation, Smith Richardson Foundation, Chiang Ching Kuo Foundation, among others. She has served on the United Nations Expert Group on Eradicating Poverty and is a member of the Advisory Board of Cambridge University Press’ Element Series on “The Politics of Development.” A Singapore native, she holds a PhD from Stanford University.
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Displaying 1 - 30 of 36 reviews
September 6, 2020
Yuen Yuen Ang has written thoughtful and deeply informative books on China before. Her last book, How China Escaped the Poverty Trap, uses systems theory, or the analysis and comparison of multiple different factors or systems to explain the story of Chinese economic development. This approach avoided the overly simplistic approach of saying only one factor or decision led to China's staggering social changes over the past 40 years.
This new book asks another important question. Political science has asserted that corruption hinders economic growth. So how does China sustained growth for so long while dealing with endemic corruption?
The first step of understanding this is "unbundling" corruption into four different types. The first is petty theft, where low level bureaucrats steal or extort - like a policeman blocking a road and asking for a 'toll'. The second is grand theft, where public funds are stolen on a larger scale - like a dictator emptying out public funds and then fleeing the country.
That corruption is harmful to growth. But not all corruption is about theft. There is also 'exchange' corruption. 'Speed money' encompasses petty bribes that businesses pay to public officials to speed things up or get around hurdles - getting permits or avoiding regulations. And on a larger scale, there is 'access money' - where business pays off more powerful officials for exclusive rights and more valuable privileges.
It is access money that provides the key to understanding how growth and corruption can go hand in hand. The CCP acts as a kind of 'profit-sharing' model, encouraging business investment and growth so long as they get a cut. This is an economy on steroids - rapid growth, but also with risk of distortion and other costs.
This method of corruption was a workaround for low state capacity. Due to the enormous size of the CCP bureaucracy for many years, local officials had to subsist on poor wages; and attempts to raise wages would easily break local budgets. Tying 'fringe benefits' to specific offices was also a way to address low state capacity, and where it became personally profitable to encourage growth instead of only stealing.
In more specific case studies, Ang examines other anti-corruption reforms; how 'access money' couldn't have taken off in the first place without discouraging grand theft and other predatory practices. Different regions of the country were then competing with each other to be the best for business and to invite investment. Nor, she cautions, would it be correct to assume 'corruption is good'. Access money still has its costs - and local government leaders can go down in flames should their powerful patrons withhold their support. And big leaders can promote risky investments and unbalanced development - begetting such problems as debt burdens and rampant speculation.
Ang refrains from excessive moralizing for the better or for the worse about China - her business is in understanding or making comparisons. In the last chapters, she compares 21st century China to the 19th century United States, where pervasive corruption and vast economic growth go hand in hand.
This is an uncommonly thoughtful work of political science, and I anticipate seeing these approaches on corruption or development applied elsewhere or studied further.
This new book asks another important question. Political science has asserted that corruption hinders economic growth. So how does China sustained growth for so long while dealing with endemic corruption?
The first step of understanding this is "unbundling" corruption into four different types. The first is petty theft, where low level bureaucrats steal or extort - like a policeman blocking a road and asking for a 'toll'. The second is grand theft, where public funds are stolen on a larger scale - like a dictator emptying out public funds and then fleeing the country.
That corruption is harmful to growth. But not all corruption is about theft. There is also 'exchange' corruption. 'Speed money' encompasses petty bribes that businesses pay to public officials to speed things up or get around hurdles - getting permits or avoiding regulations. And on a larger scale, there is 'access money' - where business pays off more powerful officials for exclusive rights and more valuable privileges.
It is access money that provides the key to understanding how growth and corruption can go hand in hand. The CCP acts as a kind of 'profit-sharing' model, encouraging business investment and growth so long as they get a cut. This is an economy on steroids - rapid growth, but also with risk of distortion and other costs.
This method of corruption was a workaround for low state capacity. Due to the enormous size of the CCP bureaucracy for many years, local officials had to subsist on poor wages; and attempts to raise wages would easily break local budgets. Tying 'fringe benefits' to specific offices was also a way to address low state capacity, and where it became personally profitable to encourage growth instead of only stealing.
In more specific case studies, Ang examines other anti-corruption reforms; how 'access money' couldn't have taken off in the first place without discouraging grand theft and other predatory practices. Different regions of the country were then competing with each other to be the best for business and to invite investment. Nor, she cautions, would it be correct to assume 'corruption is good'. Access money still has its costs - and local government leaders can go down in flames should their powerful patrons withhold their support. And big leaders can promote risky investments and unbalanced development - begetting such problems as debt burdens and rampant speculation.
Ang refrains from excessive moralizing for the better or for the worse about China - her business is in understanding or making comparisons. In the last chapters, she compares 21st century China to the 19th century United States, where pervasive corruption and vast economic growth go hand in hand.
This is an uncommonly thoughtful work of political science, and I anticipate seeing these approaches on corruption or development applied elsewhere or studied further.
July 9, 2020
Yuen Yuen Ang has done it again—innovate research executed with the grounded, historically informed, intellectual rigor that characterized her first book. Can’t wait to see what she does next! 🤓
February 20, 2024
In developmental economics, the received wisdom is that corruption is a major reason developing countries like Phillippines, India, Nigeria and others remain low-income countries. Its flip side is that western nations became affluent and remain so because they have substantially abolished corruption. China's remarkable growth since 1980 has disrupted this narrative. Everyone agrees that corruption at all levels accompanied doing business in China since its opening in 1980. So, how come China grew ten percent per year for three decades despite massive corruption? Prof. Yuen Yuen Ang provides a fascinating analysis of this puzzle and explains how such a paradox of economic boom and corruption coexisted in China. She adds China was not unique in this respect. The United States followed the same path in its Gilded Age between the 1860s and 1920s. Let us look deeper into Prof. Yuen’s thesis on corruption in China and how millions prospered despite graft.
The Transparency International ranks nations based on a single composite corruption index. Prof. Yuen says we must unbundle corruption into its components and then analyze the phenomenon because not all corruption is damaging. Certain kinds of corruption stimulate growth in the short term, yet produce serious risks and distortions in the long term. She classifies corruption under four categories. They are petty theft, grand theft, speed money and access money. Petty theft refers to acts of stealing, misuse of public funds, or extortion among street-level bureaucrats. The police harassing western tourists for wearing short skirts in Lucknow and then taking a sizable bribe before letting them go is an example. Grand theft is embezzlement or misappropriation of sizeable sums of public monies by political elites who control state finances. Sani Abacha, the military dictator of Nigeria, is an example. He siphoned almost 10 percent of the country’s entire GDP of $55 billion in 1998 into his overseas accounts. Speed money is petty bribes that businesses or citizens pay to bureaucrats to get around hurdles or speed things up. For example, in India, an entrepreneur must obtain a daunting forty licenses, opening a supermarket, forcing retailers to bribe many officers to get them faster. It cuts into their thin profit margins. Access money encompasses high-stakes rewards extended by business actors to powerful officials, not just for speed, but to access exclusive, valuable privileges. The author cites the example of Ji Jianye, former Communist Party secretary of Yangzhou city. He received hefty gifts, bribes, and company shares from his long-time cronies for near-monopoly access to government construction and renovation projects. Within six years of Ji’s tenure, their company’s profits multiplied 15-fold.
Of these four types of corruption, the first three are detrimental to growth while access money promotes rapid growth and development, though causing harm in the long run. Prof. Ang uses a drug-based metaphor to explain it. Petty and grand thefts are toxic drugs causing only harm. Speed money is a painkiller, alleviating the symptoms without curing the disease. Access money is a steroid, a growth-enhancing drug with serious side effects in the long term. Though China has all forms of corruption, the dominant type has been access money, which gave it the stunning rate of growth for three decades.
“Access money” generates growth only if other favorable conditions prevail. The Chinese communist party under Deng Xiaoping and Jiang Zemin developed a growth-friendly, profit-sharing structure of corruption. Political elites do not “grab” from businesses through extortion, but extend “helping” hands to favored investors by offering special deals, cheap land, regulatory exemptions, and other perks. They receive financial rewards and career advance. The low-level bureaucrats who don’t have the power to make deals operate in a profit-sharing model. They get fringe benefits apart from their pay, both of which are linked to the financial performance of local governments and the agencies within them. In this way, their fringe compensation acts as an efficiency wage, motivating low-level bureaucrats to generate revenue and to avoid extortion and theft. Some examples of fringe benefits are overtime pay, group vacations, free meals and gift cards. However, to channel corruption away from its most destructive forms, penalties existed alongside incentives through capacity-building reforms. This takes effect through intense regional competition, with leaders positioning and branding their locales, enhancing their overall commercial appeal. The author cites the example of Bo Xilai’s work in Chongqing and Ji Jianye’s work in Yangzhou.
With these arguments, the author says China’s mix of corruption and growth is not a paradox, but similar to the US in its gilded age. She makes a seminal point that the rise of capitalism transforms the quality of corruption from thuggery and theft to influence peddling, rather than its eradication. A ‘Progressive era’ that cracked down on certain forms of corruption followed America’s gilded age. But it still left behind forms of corruption like lobbying and political action committees, which raise money to influence elections or legislation, often at the federal level. The author suggests affluent societies legitimize corruption through institutionalization and view it as a type that promotes growth. According to her, Xi Jinping, through his crackdown on corruption, is attempting to do the same.
I find the author’s analysis a persuasive account of explaining China’s stunning growth, despite massive corruption. It pushes back at the routine commentaries of corruption as ‘always bad’ and that a single index could capture it as given by the Transparency International. In particular, her comparisons with America’s progress from the ‘gilded age’ to the post-war modern economy demystifies the nature of corruption. She shows how society’s laws change to legitimize forms of corruption through institutionalization. Many people from low-income developing nations can apply this book’s method to understand their own societies better, even though the author cautions against blindly applying it.
Overall, Prof. Yuen believes that access money, despite generating risks and mis-allocating resources toward super-profitable and speculative sectors, has been a steroid for growth. However, this raises unanswered questions about China during the past decade of slow growth and lengthy lockdowns during the pandemic. China looked dysfunctional in its Covid-19 management. Major cities like Shanghai were under extended and severe lockdowns. Health departments in many cities conducted daily tests on millions of citizens. Overseas Chinese blogs talked about a nexus between the health department and local authorities using Covid testing to make substantial wealth. Since the central government bore the cost of testing, regions conducted excessive testing, accumulating large bills and getting reimbursed for them. Local authorities colluded by declaring lockdowns, which meant you have to have more testing before you can lift it. The lockdowns brought the economy to a standstill. This vicious cycle sounds like speed money getting out of control and killing the ‘golden goose’ of economic growth. The system struggled a while to end it. Prof. Yuen does not deal with it because she wrote the book in 2020, well before the Covid-related mismanagement.
If corruption through "access money" was a means of gaining wealth, why did Xi Jinping unleash a relentless campaign against corruption from 2012 and continue it to this day? The campaign has extended beyond party and state organs into the military, state-owned enterprises and the state media and universities. The government has disciplined and punished a million and a half officials. Xi would indeed know that clamping down on corruption would dampen growth as well. The author calls it a crusade and dismisses the Western view this campaign is an excuse to purge Xi’s enemies within. She believes Xi seeks to replicate America's transition from the gilded age to the Progressive Era, and hence, it is smart. Why suppress private enterprise if that's the case? During the Jiang Zemin - Zhu Rongji era, up to eighty percent of the jobs came from the private sector, providing the growth. How does Xi usher in a progressive era by reducing the role of private enterprise? "Access money corruption" could also have worsened, affecting citizens nationwide across various spheres of society and public life. The communist party may have felt it threatening its governance credentials and legitimacy. Regional competition, instead of checking predatory corruption, seems to have exacerbated it in the Covid-19 testing scandals. Xi may have sought to control all aspects of Chinese society, like during Maoist times, to reaffirm the Party's role. This crackdown on corruption may return China more to its pre-1976 society.
Prof. Yuen is a Singaporean who did her Ph.D. at Stanford University and works now as an academic at the University of Michigan. She is an outsider to the Chinese society and political system. Chinese living inside China in the past few decades can only validate her analysis, though it is impressive to outsiders like me. I recall reading a book by Desmond Shum, a Chinese business owner and author, on his experiences doing business with the Chinese political elite. Shum brings another dimension to access money and corruption. He says the sons and daughters of the communist party intermarry, exchange inside-information, sell access to their powerful parents, and get regulatory approvals. These are the keys to large wealth in China. One needs ‘guanxi’ - connections into the system - to make a huge amount of money in China. Political heft is another. Entrepreneurs succeed in China only if they pander to the interests of the Communist Party elite and have sponsors inside the system. Once all this guanxi gives you the tremendous opportunity, you must be able to execute. So, you need both guanxi and execution capability. Shum adds that foreigners also learnt to play the ‘guanxi game’, with the Singaporeans doing the best. Their state-owned investment funds cosy up to the ‘princelings’ (sons and daughters of the Party elite). They invest money into private equity firms where the Party bigwigs and their sons and daughters hold stake. A surefire way to amass wealth.
This book is a valuable contribution to the study of corruption and unbundling it into its parts. Prof. Yuen shows how bureaucrats, business folk, local authorities and the party elite in China have a symbiotic relationship with corruption, wealth and growth. A lot of the analysis helps us understand corruption in other developing countries and even affluent nations. One of her most interesting observations is the comparison between America's gilded age in the nineteenth century and the current situation in China.
An original investigation into the relationship between corruption and growth.
The Transparency International ranks nations based on a single composite corruption index. Prof. Yuen says we must unbundle corruption into its components and then analyze the phenomenon because not all corruption is damaging. Certain kinds of corruption stimulate growth in the short term, yet produce serious risks and distortions in the long term. She classifies corruption under four categories. They are petty theft, grand theft, speed money and access money. Petty theft refers to acts of stealing, misuse of public funds, or extortion among street-level bureaucrats. The police harassing western tourists for wearing short skirts in Lucknow and then taking a sizable bribe before letting them go is an example. Grand theft is embezzlement or misappropriation of sizeable sums of public monies by political elites who control state finances. Sani Abacha, the military dictator of Nigeria, is an example. He siphoned almost 10 percent of the country’s entire GDP of $55 billion in 1998 into his overseas accounts. Speed money is petty bribes that businesses or citizens pay to bureaucrats to get around hurdles or speed things up. For example, in India, an entrepreneur must obtain a daunting forty licenses, opening a supermarket, forcing retailers to bribe many officers to get them faster. It cuts into their thin profit margins. Access money encompasses high-stakes rewards extended by business actors to powerful officials, not just for speed, but to access exclusive, valuable privileges. The author cites the example of Ji Jianye, former Communist Party secretary of Yangzhou city. He received hefty gifts, bribes, and company shares from his long-time cronies for near-monopoly access to government construction and renovation projects. Within six years of Ji’s tenure, their company’s profits multiplied 15-fold.
Of these four types of corruption, the first three are detrimental to growth while access money promotes rapid growth and development, though causing harm in the long run. Prof. Ang uses a drug-based metaphor to explain it. Petty and grand thefts are toxic drugs causing only harm. Speed money is a painkiller, alleviating the symptoms without curing the disease. Access money is a steroid, a growth-enhancing drug with serious side effects in the long term. Though China has all forms of corruption, the dominant type has been access money, which gave it the stunning rate of growth for three decades.
“Access money” generates growth only if other favorable conditions prevail. The Chinese communist party under Deng Xiaoping and Jiang Zemin developed a growth-friendly, profit-sharing structure of corruption. Political elites do not “grab” from businesses through extortion, but extend “helping” hands to favored investors by offering special deals, cheap land, regulatory exemptions, and other perks. They receive financial rewards and career advance. The low-level bureaucrats who don’t have the power to make deals operate in a profit-sharing model. They get fringe benefits apart from their pay, both of which are linked to the financial performance of local governments and the agencies within them. In this way, their fringe compensation acts as an efficiency wage, motivating low-level bureaucrats to generate revenue and to avoid extortion and theft. Some examples of fringe benefits are overtime pay, group vacations, free meals and gift cards. However, to channel corruption away from its most destructive forms, penalties existed alongside incentives through capacity-building reforms. This takes effect through intense regional competition, with leaders positioning and branding their locales, enhancing their overall commercial appeal. The author cites the example of Bo Xilai’s work in Chongqing and Ji Jianye’s work in Yangzhou.
With these arguments, the author says China’s mix of corruption and growth is not a paradox, but similar to the US in its gilded age. She makes a seminal point that the rise of capitalism transforms the quality of corruption from thuggery and theft to influence peddling, rather than its eradication. A ‘Progressive era’ that cracked down on certain forms of corruption followed America’s gilded age. But it still left behind forms of corruption like lobbying and political action committees, which raise money to influence elections or legislation, often at the federal level. The author suggests affluent societies legitimize corruption through institutionalization and view it as a type that promotes growth. According to her, Xi Jinping, through his crackdown on corruption, is attempting to do the same.
I find the author’s analysis a persuasive account of explaining China’s stunning growth, despite massive corruption. It pushes back at the routine commentaries of corruption as ‘always bad’ and that a single index could capture it as given by the Transparency International. In particular, her comparisons with America’s progress from the ‘gilded age’ to the post-war modern economy demystifies the nature of corruption. She shows how society’s laws change to legitimize forms of corruption through institutionalization. Many people from low-income developing nations can apply this book’s method to understand their own societies better, even though the author cautions against blindly applying it.
Overall, Prof. Yuen believes that access money, despite generating risks and mis-allocating resources toward super-profitable and speculative sectors, has been a steroid for growth. However, this raises unanswered questions about China during the past decade of slow growth and lengthy lockdowns during the pandemic. China looked dysfunctional in its Covid-19 management. Major cities like Shanghai were under extended and severe lockdowns. Health departments in many cities conducted daily tests on millions of citizens. Overseas Chinese blogs talked about a nexus between the health department and local authorities using Covid testing to make substantial wealth. Since the central government bore the cost of testing, regions conducted excessive testing, accumulating large bills and getting reimbursed for them. Local authorities colluded by declaring lockdowns, which meant you have to have more testing before you can lift it. The lockdowns brought the economy to a standstill. This vicious cycle sounds like speed money getting out of control and killing the ‘golden goose’ of economic growth. The system struggled a while to end it. Prof. Yuen does not deal with it because she wrote the book in 2020, well before the Covid-related mismanagement.
If corruption through "access money" was a means of gaining wealth, why did Xi Jinping unleash a relentless campaign against corruption from 2012 and continue it to this day? The campaign has extended beyond party and state organs into the military, state-owned enterprises and the state media and universities. The government has disciplined and punished a million and a half officials. Xi would indeed know that clamping down on corruption would dampen growth as well. The author calls it a crusade and dismisses the Western view this campaign is an excuse to purge Xi’s enemies within. She believes Xi seeks to replicate America's transition from the gilded age to the Progressive Era, and hence, it is smart. Why suppress private enterprise if that's the case? During the Jiang Zemin - Zhu Rongji era, up to eighty percent of the jobs came from the private sector, providing the growth. How does Xi usher in a progressive era by reducing the role of private enterprise? "Access money corruption" could also have worsened, affecting citizens nationwide across various spheres of society and public life. The communist party may have felt it threatening its governance credentials and legitimacy. Regional competition, instead of checking predatory corruption, seems to have exacerbated it in the Covid-19 testing scandals. Xi may have sought to control all aspects of Chinese society, like during Maoist times, to reaffirm the Party's role. This crackdown on corruption may return China more to its pre-1976 society.
Prof. Yuen is a Singaporean who did her Ph.D. at Stanford University and works now as an academic at the University of Michigan. She is an outsider to the Chinese society and political system. Chinese living inside China in the past few decades can only validate her analysis, though it is impressive to outsiders like me. I recall reading a book by Desmond Shum, a Chinese business owner and author, on his experiences doing business with the Chinese political elite. Shum brings another dimension to access money and corruption. He says the sons and daughters of the communist party intermarry, exchange inside-information, sell access to their powerful parents, and get regulatory approvals. These are the keys to large wealth in China. One needs ‘guanxi’ - connections into the system - to make a huge amount of money in China. Political heft is another. Entrepreneurs succeed in China only if they pander to the interests of the Communist Party elite and have sponsors inside the system. Once all this guanxi gives you the tremendous opportunity, you must be able to execute. So, you need both guanxi and execution capability. Shum adds that foreigners also learnt to play the ‘guanxi game’, with the Singaporeans doing the best. Their state-owned investment funds cosy up to the ‘princelings’ (sons and daughters of the Party elite). They invest money into private equity firms where the Party bigwigs and their sons and daughters hold stake. A surefire way to amass wealth.
This book is a valuable contribution to the study of corruption and unbundling it into its parts. Prof. Yuen shows how bureaucrats, business folk, local authorities and the party elite in China have a symbiotic relationship with corruption, wealth and growth. A lot of the analysis helps us understand corruption in other developing countries and even affluent nations. One of her most interesting observations is the comparison between America's gilded age in the nineteenth century and the current situation in China.
An original investigation into the relationship between corruption and growth.
August 17, 2020
Fantastic book. Must-read for anyone interested in corruption, state-building or governance
October 4, 2022
Really accessible study into how China's economy boomed during the Deng, Jiang, and Hu eras despite massive corruption. Will be excited to read more from Ang in the future!
January 11, 2023
Ang's Gilded works fantastically well in two aspects, is capable in a third aspect, and unfortunately falls short in a fourth area.
Firstly, as a work of China scholarship, Gilded is outstanding. Ang is able to give a statistical grounding (or, the strongest statistical grounding possible given the opaque subject matter) to the development of corruption in China over the course of its reform and opening eras. Her analysis disambiguates types of corruption, and gives a coherent analysis of the drawbacks, as well as the absence of other drawbacks, given China's particular type/mix of corruption.
The second area where this work excels is its innovative analysis of corruption as a phenomenon. Ang points out that there are different types of corruption that any country could have, and that specific types of corruption lead to different outcomes, and optimal policy countermeasures. Her ability to disaggregate the types of corruption gives some much needed contrast between, say, the types of corruption endemic to China as compared to those types of corruption endemic to Thailand.
Gilded, however, is not a 'fun' read. WOW, was it academic in tone. There are two case studies that follow the rise and fall of prominent figures in China that were brought down for corrupt practices, but the anecdotes are otherwise few and far between. For a book that features "Gilded Age" right there in the title, I was hoping for some more stories, anecdotes, and descriptions of what corruption looks like on the ground. The Great Gatsby this isn't.
Finally, while Gilded opens a new door in the study of corruption as a discipline, I believe that her analysis focuses too much on the China-US comparison. I would have preferred another two or three countries to use as relative benchmarks instead of having the US, not because the US ins't an important country to evaluate from this angle (it most certainly is), but rather because the US and China are both relatively exceptional countries, and using one to benchmark the other will create a distorted lens from which to evaluate. Ang recognizes the need for more survey responses to bolster her sample sizes, but the omissions of a swath of European, Central Asia, and Middle Eastern countries would help.
Besides all of this, corruption (and other opaque areas of study) must be taken with a large grain of salt, given that it is near impossible to confidently obtain a robust sample set. Are those officers arrested for corruption representative of the whole system? How many corrupt officers are not caught for every one that is? Do these ratios hold across borders? Unfortunately, it is near impossible to get satisfactory (and statistically robust) answers to these questions. Given those limitations, however, Ang's work is a fantastic addition to the field of study.
Firstly, as a work of China scholarship, Gilded is outstanding. Ang is able to give a statistical grounding (or, the strongest statistical grounding possible given the opaque subject matter) to the development of corruption in China over the course of its reform and opening eras. Her analysis disambiguates types of corruption, and gives a coherent analysis of the drawbacks, as well as the absence of other drawbacks, given China's particular type/mix of corruption.
The second area where this work excels is its innovative analysis of corruption as a phenomenon. Ang points out that there are different types of corruption that any country could have, and that specific types of corruption lead to different outcomes, and optimal policy countermeasures. Her ability to disaggregate the types of corruption gives some much needed contrast between, say, the types of corruption endemic to China as compared to those types of corruption endemic to Thailand.
Gilded, however, is not a 'fun' read. WOW, was it academic in tone. There are two case studies that follow the rise and fall of prominent figures in China that were brought down for corrupt practices, but the anecdotes are otherwise few and far between. For a book that features "Gilded Age" right there in the title, I was hoping for some more stories, anecdotes, and descriptions of what corruption looks like on the ground. The Great Gatsby this isn't.
Finally, while Gilded opens a new door in the study of corruption as a discipline, I believe that her analysis focuses too much on the China-US comparison. I would have preferred another two or three countries to use as relative benchmarks instead of having the US, not because the US ins't an important country to evaluate from this angle (it most certainly is), but rather because the US and China are both relatively exceptional countries, and using one to benchmark the other will create a distorted lens from which to evaluate. Ang recognizes the need for more survey responses to bolster her sample sizes, but the omissions of a swath of European, Central Asia, and Middle Eastern countries would help.
Besides all of this, corruption (and other opaque areas of study) must be taken with a large grain of salt, given that it is near impossible to confidently obtain a robust sample set. Are those officers arrested for corruption representative of the whole system? How many corrupt officers are not caught for every one that is? Do these ratios hold across borders? Unfortunately, it is near impossible to get satisfactory (and statistically robust) answers to these questions. Given those limitations, however, Ang's work is a fantastic addition to the field of study.
March 15, 2021
China’s Gilded Age es probablemente el trabajo sobre corrupción más sofisticado que he visto. Va más allá de los lugares comunes del institucionalismo “extractive institutions” y le da contexto al estudio de la corrupción en un genuino esfuerzo por entender y no solo por construir rankings.
El trabajo busca resolver la aparente paradoja de como un país con tan elevados niveles de corrupción como China puede crecer tan rápido. La respuesta es que la corrupción es más complicada que lo que solemos decir de ella, distintos tipos de corrupción so más o menos compatibles con el crecimiento y son dañinos para la sociedad de formas distintas.
Yuen Yuen Ang compara a China con Estados Unidos de finales del siglo XIX la era de los rober barons, su gilded age y encuentra un gran paralelismo entre el desarrollo capitalista de Estados Unidos en ese periodo y el de China ahora, siendo el lobby, el dinero usado para abrir puertas de industrias e inversiones lo que domina el espectro de corrupción en China.
Es el sistema chino de compartir las ganancias del desarrollo entre los distintos niveles de su burocracia lo que le da a la corrupción en China su particular forma, al alinear los incentivos de conseguir mejoras materiales en la comunidad como mecanismo para obtener ganancias materiales en el individuo.
Es un libro muy bien escrito, muy fácil de leer, con aportaciones metodológicas a la medición de la corrupción y un gran estudio de casos de elites políticas y de la economía política en China.
Ojalá en todo el mundo y en especial en México adoptáramos esta forma más compleja, más sofisticada, más contextual de estudiar la corrupción y otros fenómenos sociales.
El trabajo busca resolver la aparente paradoja de como un país con tan elevados niveles de corrupción como China puede crecer tan rápido. La respuesta es que la corrupción es más complicada que lo que solemos decir de ella, distintos tipos de corrupción so más o menos compatibles con el crecimiento y son dañinos para la sociedad de formas distintas.
Yuen Yuen Ang compara a China con Estados Unidos de finales del siglo XIX la era de los rober barons, su gilded age y encuentra un gran paralelismo entre el desarrollo capitalista de Estados Unidos en ese periodo y el de China ahora, siendo el lobby, el dinero usado para abrir puertas de industrias e inversiones lo que domina el espectro de corrupción en China.
Es el sistema chino de compartir las ganancias del desarrollo entre los distintos niveles de su burocracia lo que le da a la corrupción en China su particular forma, al alinear los incentivos de conseguir mejoras materiales en la comunidad como mecanismo para obtener ganancias materiales en el individuo.
Es un libro muy bien escrito, muy fácil de leer, con aportaciones metodológicas a la medición de la corrupción y un gran estudio de casos de elites políticas y de la economía política en China.
Ojalá en todo el mundo y en especial en México adoptáramos esta forma más compleja, más sofisticada, más contextual de estudiar la corrupción y otros fenómenos sociales.
September 13, 2021
• Petty theft refers to acts of stealing, misuse of public funds, or extortion among street-level bureaucrats.
• Grand theft refers to embezzlement or misappropriation of large sums
of public monies by political elites who control state finances.
• Speed money means petty bribes that businesses or citizens pay to
bureaucrats to get around hurdles or speed things up.
• Access money encompasses high-stakes rewards extended by business
actors to powerful officials, not just for speed, but to access exclusive,
valuable privileges.
As Huntington wrote, “Corruption may be one way of surmounting traditional laws or bureaucratic regulations which hamper economic expansion.”
County of Hubei: “Investors are Gods, prospectors of investors are
heroes, bureaucrats are humble servants, and those who harm corporate
interests are sinners.”
State–business relations in China are
not “extractive,” as Acemoglu and Robinson assert, but rather
transactional
Huntington’s
“life cycle” theory of corruption,16 which argues that corruption rises
steeply during stages of modernization and then decreases as countries
grow richer and acquire state capabilities.
China is
not communist. Far from egalitarian, China has seen widening
inequality, at a level exceeding even capitalist America.46 In practice,
Chinese political economy operates not according to Marx’s exhortation of “each according to his needs” but rather by the principle of
“each according to his ability and connections” (Chapters 4 and 5).
From this perspective, China is better understood as a capitalist
dictatorship disguised as communist.
“inequalities in other dimensions such as health, education,
access to technologies, and exposure to shocks.”
85 This expanded conception of inequality is crucial. My study suggests that future extensions
of this measure should confront inequality in access to political influence,
which is inextricably linked to corruption.
To elevate our understanding of the relationship between corruption and capitalism, we must first unbundle corruption and then distinguish its effects on GDP from hard-to-measure social
and economic costs
• Grand theft refers to embezzlement or misappropriation of large sums
of public monies by political elites who control state finances.
• Speed money means petty bribes that businesses or citizens pay to
bureaucrats to get around hurdles or speed things up.
• Access money encompasses high-stakes rewards extended by business
actors to powerful officials, not just for speed, but to access exclusive,
valuable privileges.
As Huntington wrote, “Corruption may be one way of surmounting traditional laws or bureaucratic regulations which hamper economic expansion.”
County of Hubei: “Investors are Gods, prospectors of investors are
heroes, bureaucrats are humble servants, and those who harm corporate
interests are sinners.”
State–business relations in China are
not “extractive,” as Acemoglu and Robinson assert, but rather
transactional
Huntington’s
“life cycle” theory of corruption,16 which argues that corruption rises
steeply during stages of modernization and then decreases as countries
grow richer and acquire state capabilities.
China is
not communist. Far from egalitarian, China has seen widening
inequality, at a level exceeding even capitalist America.46 In practice,
Chinese political economy operates not according to Marx’s exhortation of “each according to his needs” but rather by the principle of
“each according to his ability and connections” (Chapters 4 and 5).
From this perspective, China is better understood as a capitalist
dictatorship disguised as communist.
“inequalities in other dimensions such as health, education,
access to technologies, and exposure to shocks.”
85 This expanded conception of inequality is crucial. My study suggests that future extensions
of this measure should confront inequality in access to political influence,
which is inextricably linked to corruption.
To elevate our understanding of the relationship between corruption and capitalism, we must first unbundle corruption and then distinguish its effects on GDP from hard-to-measure social
and economic costs
This entire review has been hidden because of spoilers.
September 13, 2020
A short book that discusses corruption in China during the "reform and opening" era. It's based on relatively thorough quantitative and qualitative research; I found it persuasive and informative.
The central insight is that "corruption" needs to be unbundled to understand why it only sometimes hinders growth. The dominant mode of corruption in poor countries is theft (either small-scale or grand, by political elites) and "speed money" that greases the wheels of bureaucratic procedures. In contrast, in rich countries (and in China) the dominant mode is "access money": businessmen exchanging favors with high-level officials, enabling entirely new business opportunities. The author doesn't use such language, but this is an extension of entrepreneurship from the private to the public sphere. An individual or small group can instigate policy changes without a slow process of aligning many stakeholders; sometimes these policy changes are improvements, and both the individuals and the public benefit. Sometimes, of course, the public loses out, especially in the long run. In any case, things can move fast. This type of freewheeling, close relationship between business and political elites appears to have also prevailed in the US during the Gilded Age.
Although the main point is reiterated a few times, on the whole the book is much more terse and consistently interesting than most popular nonfiction. Anyone with an interest in China or economic growth would enjoy reading it.
The central insight is that "corruption" needs to be unbundled to understand why it only sometimes hinders growth. The dominant mode of corruption in poor countries is theft (either small-scale or grand, by political elites) and "speed money" that greases the wheels of bureaucratic procedures. In contrast, in rich countries (and in China) the dominant mode is "access money": businessmen exchanging favors with high-level officials, enabling entirely new business opportunities. The author doesn't use such language, but this is an extension of entrepreneurship from the private to the public sphere. An individual or small group can instigate policy changes without a slow process of aligning many stakeholders; sometimes these policy changes are improvements, and both the individuals and the public benefit. Sometimes, of course, the public loses out, especially in the long run. In any case, things can move fast. This type of freewheeling, close relationship between business and political elites appears to have also prevailed in the US during the Gilded Age.
Although the main point is reiterated a few times, on the whole the book is much more terse and consistently interesting than most popular nonfiction. Anyone with an interest in China or economic growth would enjoy reading it.
December 26, 2020
The book sets up a convincing argument that rejects the simplistic dichotomous view that corruption is either good or bad for growth, rather it maintains that all corruption is harmful, but this harm varies in terms of magnitude and timescale and the associated benefits can sometimes outweigh the harm
The author uses a useful and clear 2x2 matrix to show different forms of corruption that both explains the Chinese Paradox of high corruption and growth as well as the apparent contradictions in China's political economy
More broadly the book provides a framework to analyse and unbundle corruption in any country, by considering elites/non-elites and transactional/non-transactional corruption and contained deep, investigative qualitative research on the compensation of Chinese bureaucrats
The case studies on Bo Xilai and Ji Jianye were illuminating and clearly demonstrated that corruption can bring investment and growth; access money in China has spurred politically connected capitalists to invest and build, while enabling politicians to achieve their development targets and ascend political ladders
I did disagree with the author defining China as a capitalist dictatorship, given China's explicit commitment to Marxist Leninism and their clearly Socialist policies, which underlined the fact I thought the author's political economy analysis fell short, but this doesn't take away from the high quality of their overall analysis
Highly recommended for anyone interested in China's modern development and corruption more generally
The author uses a useful and clear 2x2 matrix to show different forms of corruption that both explains the Chinese Paradox of high corruption and growth as well as the apparent contradictions in China's political economy
More broadly the book provides a framework to analyse and unbundle corruption in any country, by considering elites/non-elites and transactional/non-transactional corruption and contained deep, investigative qualitative research on the compensation of Chinese bureaucrats
The case studies on Bo Xilai and Ji Jianye were illuminating and clearly demonstrated that corruption can bring investment and growth; access money in China has spurred politically connected capitalists to invest and build, while enabling politicians to achieve their development targets and ascend political ladders
I did disagree with the author defining China as a capitalist dictatorship, given China's explicit commitment to Marxist Leninism and their clearly Socialist policies, which underlined the fact I thought the author's political economy analysis fell short, but this doesn't take away from the high quality of their overall analysis
Highly recommended for anyone interested in China's modern development and corruption more generally
November 24, 2021
Very interesting research on the state of corruption in China. Ang contrasts India, Russia and the USA, and shows how access-money is the main temptation in the PRC, a subtype of corruption that doesn’t have the great cost of stifling economic development. Access to government contracts allow business to prosper and share in the rewards with their benefactors and their families. Ang warns that as government policy veers to more control of media, NGO’s, etc. it will be harder to uncover new malfeasances with only the top down approach currently favored.
I found the chapters on remuneration of public servants very insightful too. Base salaries are low (below subsidence levels) but bribe taking is discouraged by a system that awards allowances and bonuses from profit sharing of a well performing local economy.
It’s an academic publication, which means there is a bit too much repetition (introduction, argument, conclusion) to make it a real popular read.
I'd recommend Desmond Shum's Red Roulette: An Insider's Story of Wealth, Power, Corruption and Vengeance in Today's China for a good account where access money can get you.
I found the chapters on remuneration of public servants very insightful too. Base salaries are low (below subsidence levels) but bribe taking is discouraged by a system that awards allowances and bonuses from profit sharing of a well performing local economy.
It’s an academic publication, which means there is a bit too much repetition (introduction, argument, conclusion) to make it a real popular read.
I'd recommend Desmond Shum's Red Roulette: An Insider's Story of Wealth, Power, Corruption and Vengeance in Today's China for a good account where access money can get you.
October 3, 2020
Yuen Yuen Ang sets forth a novel argument on the sometimes beneficial relationship between corruption and economic growth, convincingly arguing for a new understanding of corruption, both intrinsically and from a comparative perspective between countries. While China's endemic corruption has drawn headlines for decades, and has been especially awarded attention since Xi's crackdown campaign (which has since turned into a new normal), the country simultaneously posted continuous high economic growth figures. Ang shows, by unbundling corruption in China's economy, how access money plays an important role in accelerating economic growth since, in particular, the 1990s.
The comparison with America's Gilded Age, which saw a similar symbiotic relationship between corruption and economic growth, is apt but not enough as a stand-alone example to argue how essentially nothing new's under the sun. As Ang admits herself, a lot more research is needed to show how corruption has developed in other countries and for what reason, in order for policymakers and academics to draw lessons and gain insight. Hopefully this call is taken up by other social scientists.
The comparison with America's Gilded Age, which saw a similar symbiotic relationship between corruption and economic growth, is apt but not enough as a stand-alone example to argue how essentially nothing new's under the sun. As Ang admits herself, a lot more research is needed to show how corruption has developed in other countries and for what reason, in order for policymakers and academics to draw lessons and gain insight. Hopefully this call is taken up by other social scientists.
December 5, 2020
This book helps your understanding of corruption become more nuanced. The author argues, convincingly I think, that there is growth enhancing corruption (access money, dominant in CHina and the USA), and there is grows arresting corruption, such as speed money (Russia) or elite theft (Nigeria).
She also brings empirical evidence that Xi Jin Ping's anticorruption campaign is real, it is not simply a political weapon as many in the West claim, based on no more than prejudice.
I wish the author would reflect upon her own country, Singapore. It is one of the least corrupt countries in the world, on par with Scandinavia. Why is it so uncorrupt, unlike similarly culturally Chinese PRC, Taiwan and Hong Kong? And how can it be so uncorrupt, if to the outside it is a corrupt tax haven?
She also brings empirical evidence that Xi Jin Ping's anticorruption campaign is real, it is not simply a political weapon as many in the West claim, based on no more than prejudice.
I wish the author would reflect upon her own country, Singapore. It is one of the least corrupt countries in the world, on par with Scandinavia. Why is it so uncorrupt, unlike similarly culturally Chinese PRC, Taiwan and Hong Kong? And how can it be so uncorrupt, if to the outside it is a corrupt tax haven?
February 14, 2021
A very good introduction to China's institutions of corruption (and acknowledgement of our own in America), with a well-rounded and disciplined approach to research and data analysis by the author. Writing style was not extremely engaging.
June 30, 2022
Today the world is awash in dirty money.
Money from drug cartels. Money from Russian oligarchs. And not a little money stolen under the nose of the President of China.
China is legendary for its corruption.
But why has China prospered when other states — Russia and Nigeria to name only two — seemingly fold in upon themselves.
That is the theme of this book.
The answer is twofold: on one level, that it rewards people in power to cut corners to get things done very fast. And to get rewarded for their success by those who stand to make the biggest profits.
The other reason is that China has 50 million public servants and many if not most of them officially earn a salary that is below subsistence level. It’s a system built with incentives to steal.
And steal they do.
A lot of that money flows out of the country with estimates ranging as high as $425 billion in 2014. Compare that with estimates of $800 billion taken by oligarchs out of Russia. But a lot of that money comes in the form of perquisites from interested parties, so a lot of it never gets counted.
President Xi has made it a hallmark of his regime to cut down on the graft, but according to the author he will never completely succeed because of the continued incentives to steal and steal big.
What makes a provincial official succeed in China? Economic success. And who can bring this kind of success to a provincial official? Entrepreneurs. Contractors. Financiers. And like Russia, the system is built on relationships from the very bottom to the very top. The little crooks have patrons above, and above them are bigger patrons, and on up the chain of command.
Xi makes noises about cleaning up the grifters, but Putin is so totally greasy himself you will never see him launching clean up campaigns like those you see periodically in China.
The author says the cost of the big type of grifting in China, much as in America and other western nations, comes in the form of recessions, real estate crashes, and systemic risk in the financial system.
China is not alone in its corruption among the world’s most powerful economies. American corruption comes through lobbying, old boys’ clubs, and political contributions.
The height of American corruption was a phase in its development, the so-called Guilded Age after the Civil War and pre-dating the rise of the progressives.
But China is not a very transparent society and for that reason it’s graft will never be cleaned up. And without a genuine commitment of the leadership to the the citizenry to transparency, much of the very worst corruption will not get better..
Whether this age is a passing phase for China has yet to be determined.
Call me old-fashioned but I don’t want my government acting for its own interests ahead of mine, and for that reason, if no other, do I not want China as it is presently constituted to possess the world’s reserve currency.
Money from drug cartels. Money from Russian oligarchs. And not a little money stolen under the nose of the President of China.
China is legendary for its corruption.
But why has China prospered when other states — Russia and Nigeria to name only two — seemingly fold in upon themselves.
That is the theme of this book.
The answer is twofold: on one level, that it rewards people in power to cut corners to get things done very fast. And to get rewarded for their success by those who stand to make the biggest profits.
The other reason is that China has 50 million public servants and many if not most of them officially earn a salary that is below subsistence level. It’s a system built with incentives to steal.
And steal they do.
A lot of that money flows out of the country with estimates ranging as high as $425 billion in 2014. Compare that with estimates of $800 billion taken by oligarchs out of Russia. But a lot of that money comes in the form of perquisites from interested parties, so a lot of it never gets counted.
President Xi has made it a hallmark of his regime to cut down on the graft, but according to the author he will never completely succeed because of the continued incentives to steal and steal big.
What makes a provincial official succeed in China? Economic success. And who can bring this kind of success to a provincial official? Entrepreneurs. Contractors. Financiers. And like Russia, the system is built on relationships from the very bottom to the very top. The little crooks have patrons above, and above them are bigger patrons, and on up the chain of command.
Xi makes noises about cleaning up the grifters, but Putin is so totally greasy himself you will never see him launching clean up campaigns like those you see periodically in China.
The author says the cost of the big type of grifting in China, much as in America and other western nations, comes in the form of recessions, real estate crashes, and systemic risk in the financial system.
China is not alone in its corruption among the world’s most powerful economies. American corruption comes through lobbying, old boys’ clubs, and political contributions.
The height of American corruption was a phase in its development, the so-called Guilded Age after the Civil War and pre-dating the rise of the progressives.
But China is not a very transparent society and for that reason it’s graft will never be cleaned up. And without a genuine commitment of the leadership to the the citizenry to transparency, much of the very worst corruption will not get better..
Whether this age is a passing phase for China has yet to be determined.
Call me old-fashioned but I don’t want my government acting for its own interests ahead of mine, and for that reason, if no other, do I not want China as it is presently constituted to possess the world’s reserve currency.
November 29, 2022
"China is better understood as a capitalist dictatorship disguised as communist." Shots fired!
Came here by way of a great Freakonomics episode ("Is the US Really Less Corrupt than China - and How about Russia?") and the book is just as interesting. The lump CPI number lets rich, developed countries hide behind a skewed claim that corruption does not have a significant presence in their national economic and political systems. In contrast, the Unbundled Corruption Index allows Ang to paint a much more nuanced picture (beyond the unproductive "oh, China's just... an outlier") of competence and certain kinds of corruption going hand in hand.
Ang also makes a beautiful defense of qualitative research and discovery as legitimate, substantial forms of research and directly points out why providing a new model/understanding of corruption is such a touchy subject for wealthy (Western) democratic countries: "corruption connotes backwardness", which makes it awkward when someone points out you might be both rich and still rather corrupt, even if no third-party observer is at all surprised.
There are some excellent asides in her conclusions (e.g. - "Institutional corruption is a perversion of formal political representation, which lies at the heart of democracy", ergo, China is unlikely to develop that particular type of corruption) and a lot more detail explored in the book compared to the episode that brought me here. Glad it did!
Came here by way of a great Freakonomics episode ("Is the US Really Less Corrupt than China - and How about Russia?") and the book is just as interesting. The lump CPI number lets rich, developed countries hide behind a skewed claim that corruption does not have a significant presence in their national economic and political systems. In contrast, the Unbundled Corruption Index allows Ang to paint a much more nuanced picture (beyond the unproductive "oh, China's just... an outlier") of competence and certain kinds of corruption going hand in hand.
Ang also makes a beautiful defense of qualitative research and discovery as legitimate, substantial forms of research and directly points out why providing a new model/understanding of corruption is such a touchy subject for wealthy (Western) democratic countries: "corruption connotes backwardness", which makes it awkward when someone points out you might be both rich and still rather corrupt, even if no third-party observer is at all surprised.
There are some excellent asides in her conclusions (e.g. - "Institutional corruption is a perversion of formal political representation, which lies at the heart of democracy", ergo, China is unlikely to develop that particular type of corruption) and a lot more detail explored in the book compared to the episode that brought me here. Glad it did!
April 10, 2023
Very very good book. I always thought that the competing views of Chinese government -hyper corrupt vs get tons of shiz done- were weird and I didn't really know where to begin to understand the nuances.
This book makes the case that there are different kinds of corruption -4 in total- each of them with varying positives and negatives. To simply say all corruption is good or bad for a country would be fallacious.
The author continues to detail that China mainly deals with problems with access money. "This type of corruption spurs investment and transactions in the short term, but it also generates risks and misallocates resources toward super-profitable, speculative sectors. In addition, access money exacerbates inequality by enriching a club of corrupt officials and politically connected capitalists".
I find myself agreeing with many of the conclusions drawn. However, I must question the data use. I think, no matter what methodology developed, data collection attempting to measure corruption is nearly impossible to be accurate. I'm not qualified to give much more of a critique than that; certainly in no position to give any meaningful recommendations. I simply felt the need to point out my concern that the conclusions drawn are only as strong as the data.
This book makes the case that there are different kinds of corruption -4 in total- each of them with varying positives and negatives. To simply say all corruption is good or bad for a country would be fallacious.
The author continues to detail that China mainly deals with problems with access money. "This type of corruption spurs investment and transactions in the short term, but it also generates risks and misallocates resources toward super-profitable, speculative sectors. In addition, access money exacerbates inequality by enriching a club of corrupt officials and politically connected capitalists".
I find myself agreeing with many of the conclusions drawn. However, I must question the data use. I think, no matter what methodology developed, data collection attempting to measure corruption is nearly impossible to be accurate. I'm not qualified to give much more of a critique than that; certainly in no position to give any meaningful recommendations. I simply felt the need to point out my concern that the conclusions drawn are only as strong as the data.
September 2, 2023
An excellent book, simultaneously concise, readable, and rigorous. Ang pushes back on the narrative of corruption as homogenous and growth-destroying, instead seeking to describe the various forms that it can take and how those different forms have different political-economic impacts. Notably, she argues that “access money” can actually stimulate the economy in the short run by greasing the wheels of political approvals and by aligning political and business interests (albeit at the cost of inefficient allocation of resources and increased inequality).
She also provides a strong elucidation of the compensation of Chinese bureaucrats, demonstrating that it is structured such that the long run benefits of economic growth outweigh the potential short-term benefits of growth-destroying, extractive corruption (and importantly, that Chinese bureaucrats appear to mostly understand this fact).
Plus, bonus points to her for not only calling the book “China’s Gilded Age” as a catchy title, but actually following through with a comparative analysis of the Gilded Age and China’s recent development pattern.
If you’re interested in the political economy of corruption or development more generally, this book is worth checking out!
She also provides a strong elucidation of the compensation of Chinese bureaucrats, demonstrating that it is structured such that the long run benefits of economic growth outweigh the potential short-term benefits of growth-destroying, extractive corruption (and importantly, that Chinese bureaucrats appear to mostly understand this fact).
Plus, bonus points to her for not only calling the book “China’s Gilded Age” as a catchy title, but actually following through with a comparative analysis of the Gilded Age and China’s recent development pattern.
If you’re interested in the political economy of corruption or development more generally, this book is worth checking out!
February 8, 2025
Went into this expecting a broader analysis of Chinese inequality rather than just Chinese corruption specifically which kinda let me down to begin with. More than that though this book really rubbed me the wrong way with its structure which is just a series of regressions basically — like I’m happy to get a better understanding of the results, but for a book you got to offer something more cohesive than that. This approach to structure/style is my main complaint, but the conclusion that China can only avoid corruption by scaling down state involvement seems out of step with… a lot of stuff from China’s massive success recently to the nature of state-economy relations (Polanyi would never). I feel like this review has been pretty harsh. There were some legitimately interesting points throughout the book, I especially liked the corruption case studies and the author’s brief dives into the history of Chinese corruption, but overall it feels like this should’ve been a paper, not a book
January 11, 2022
A lucid account on why China has maintained high-speed growths over the last few decades despite its vast corruption. Underlying the book's general claim that China is in a phase similar to the 19th-century US, Ang offered a sharply defined typology of the 4 different types of corruption, and highlighted the ambivalent role that the "access money" type of corruption (by political elites, who in exchange offer benefits to the private sector) plays in sustaining China's economic growth, as well as its risks. This book also historicized the puzzling relationship between development and corruption by tying it to CCP's historical pivot, under Deng Xiaoping's leadership, towards a party whose legitimacy is defined by its elite members' success in fostering large-scale and regional economic growths.
December 5, 2025
Corruption is a barrier to development. This has been talked about ad nauseam in development economics but what hasn’t been talked about is how the underlying mechanics of it work to harm. Yuen unpacks the vaguely defined notion of corruption into various categories (petty theft vs bribes to get things done fast vs influence peddling etc.) to see just how corruption affects a country. The conclusion she comes to is all corruption is bad but not all types are equally bad with some even encouraging growth. This is the key to her understanding on how China has had rapid growth in both economic and state capacity while also having high levels of corruption. Really strong scholarship that works at digging down and finding underlying mechanisms rather than just hand waving and lumping a variety of very different activités as corruptions.
December 31, 2021
Short and to the point: chinas rise through economic turmoil to powerhouse is interesting, but that cronyism persisted makes it all the more intriguing.
The data underlying her findings is mostly solid, though she acknowledges the gaps.
Don’t read this if you think you’re finding the Rosetta Stone to China’s corruption; read it if you want some fascinating insights into how corruption and economic explosions can coexist
The data underlying her findings is mostly solid, though she acknowledges the gaps.
Don’t read this if you think you’re finding the Rosetta Stone to China’s corruption; read it if you want some fascinating insights into how corruption and economic explosions can coexist
March 27, 2022
Very precise observations about topics that are often generalized not only by politicians but also scholars. This book definetely challenged several of my assumptions about China, the impact and measurements of corruption. But might not be so interesting and easy reading for people not working in the field of anti-corruption.
September 9, 2022
Loved how well-researched this book was with endless citations. Enlightening comparison of China’s gilded age to the US’s gilded age.
The unbundled corruption index should be adopted by Transparency International asap.
I wonder if there’s any country that has risen above “access money” corruption?
Wish Kenya had been 1 of the 16 countries the author picked to do her comparative analysis.
The unbundled corruption index should be adopted by Transparency International asap.
I wonder if there’s any country that has risen above “access money” corruption?
Wish Kenya had been 1 of the 16 countries the author picked to do her comparative analysis.
January 14, 2024
In this book, Ang details her analysis and observations in a way that is accessible to non-subject matter experts while still providing all of the receipts in a robust appendix. And on top of that, it’s well-written and interesting! I highly recommend giving this a read both for the subject and for her analysis, which is both quantitative and qualitative.
June 10, 2024
A fascinating read presented in digestible chunks! I thoroughly enjoyed reading this book as it took a new angle on corruption that I found highly interesting and gave a wonderful new view of the Chinese civil servant system, with its high points and flaws.
August 10, 2025
Short and accurate. Corruption in the form of exchange power for money is the unspoken norm in Chinese political system. Everyone knows it. This books analyzes the problem from a historical and institutional level.
This entire review has been hidden because of spoilers.
October 9, 2025
interesting and novel conceptualisation and elucidation of the different forms and mechanisms of corruption in developing and developed nations. Likely an example of a book which could have been written as a long form essay
December 21, 2025
Took much longer than expected to finish this book because it felt a lot more like a long research paper rather than a book.
It was still interesting to see how the author broke down "corruption" to different levels and showed how corruption is actually encouraged by the systems.
It was still interesting to see how the author broke down "corruption" to different levels and showed how corruption is actually encouraged by the systems.
February 28, 2026
Genuinely such a pleasant read. Concise summaries w detailed and original data collection/analysis turned captivating visual. Life changingly reframed how I understand govt and politics!! Would recommend as a top 5 book on modern China or politics
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