THE “UMBRELLA SOCIETY”: A NEW CONCEPT FOR OBSERVING SOCIAL-ECONOMIC STRUCTURAL TRANSITION IN CHINA

Abstract

Since the economic reforms and opening up of China in 1978, China has witnessed national development that has ushered in huge social and economic changes. This paper tries to answer the following questions concerning China’s economic take-off: What is the relation between China’s booming economy and its social-economic structural transition? What roles do governments and enterprises play? Although China claims to comprehensively deepen its market-oriented reform, and the government solely serves as a “referee”, we found, through case studies of “local development” and “enterprise growth”, that a major driving force of China’s economic development is still the “umbrella relation” between local governments and enterprises. To be specific, local governments are patrons offering protection and preferential policy to local enterprises which are clients. Local resource allocation and economic-social development in many regions of China present a strong characteristic of an “umbrella society”.