Transcript lecture 8_ collaborative governance in china.ppt

Lecture 8
The Chinese Road toward
Collaborative Governance
Why collaborative governance for China?
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China has become a complex and open society with all
social and economic problems faced by western
societies.
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Issues like ageing, environmental degradation, domestic
migration, social and economic polarization are unprecedented
due to China’s size.
Rise of market and civil society provide both pressures
and incentives of cross-sector collaboration in response
to new governance problems.
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External learning is also a partial explanation for developing
countries like China.
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China’s change on photos：
The east side of Bund (外滩) in the 1980s
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In 2009
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Collaborative governance: Definition
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Collaborative governance (CG) highlights widely
distributed and coordinated power across public, private
and nonprofit sectors in public decision making and
implementation.
CG responds to not just the capacity limit of governments,
but also a demand for more and better democracy.
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A combination of instrumental and political rationale.
CG vs. Good governance
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CG focuses on sharing of power among plural actors.
Good governance is more inclusive of values like
transparency, accountability, responsiveness, participation,
etc.
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A contrast between contracting and CG
Service contracting
Functions
Targeted capacities through
cooperation
Goal setting
Relation between actors
Type of shared discretion
Accountability
State actor obligations on
nonpublic actor
Philosophical foundation
CG
Service delivery
Operational
Public governance
Governing
Decided by contractees
Principal-agent
(hierarchical)
Managerial
Managerial, specified
by contracts
Agreed and coproduced
Collaborators (horizontal)
Less
New Public
Management
Administrative
Relational and political,
negotiated and consensusbased
More
New Public Governance
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General Chinese Context for CG
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1. Historical and cultural tradition
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Ancient governing system integrated political, administrative, military,
and even religious powers.
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Confucian philosophy supported hierarchically designed political and
social power system through its moral principles.
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Government-oriented culture (官本位).
Centralized empire and united system (中央帝国和大一统秩序）
There is only one sun in the sky; and one master of the people. (天无二日,
民无二主). Political factions are not allowed.
Harmony(和）is achieved through hierarchically designed social roles with
a focus on compliance. (君君臣臣父父子子）.
Rule of the game: Power struggle tends to be handled by centralizing
powers.
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A winner-take-all system offering no institutional protection to competing parties.
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2. Governance between 1949 and 1978
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PRC in its early stage had an unprecedentedly unified
power system.
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Integration between government and enterprises (政企合一)
Between party and government (党政合一)
Between government and social organizations (政社合一)
State’s role (service and control) was further expanded due
to modern technology, industrialization, and ideological
control.
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It effectively reached the bottom of society.
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3. Governance since 1978
 A trend of disintegration happened in all above areas
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Economic marketization and reform of SOEs
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Major rounds of administrative reforms
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From separation to division of labor
Giving up omnipotent social control
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In 2013, non-state sector economy accounted for 82% of
enterprises, 60% of national GDP, 69% fiscal revenues, and 80% of
urban employment.
As well as social welfare.
For example, household registration.
Reintegration happened subsequently.
 PPP, BOT, service contracting, franchising…
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Bridges on and tunnels
below the Huangpu
River in Shanghai (The
BUND).
Mascot: Haibao
The 2008 Olympic
Game’s Main Stadium:
A PPP project.
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Fudan Crowne Plaza Hotel: A BOT
project
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Aggregate level of service outsourcing in China 2001-2004
Level of outsourcing
30%
25%
20%
15%
10%
2001
2002
Lower Limit
2003
2004
Upper Limit
Jing (2008)
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Collaboration in social programs
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Venture Philanthropy (VP) program in Shanghai
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Nonprofit Incubator (NPI), a nonprofit hub, works with
Shanghai Municipal government to
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Design VP program of RMB 10 million (in 2009). Shanghai
Municipal government offered money.
Operate the program
Select nonprofit applicants
Deliver services to selected nonprofits
Monitor their capacity building activities
Evaluate their performance
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The path toward collaborative governance (CG)
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1. Incremental
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China’s reform has been characterized by gradual trialand-error processes.
Slow power shift makes elite transformation possible
and minimizes resistance to reforms.
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Incremental change may cumulate confidence, information,
experience, legitimacy, and thus support for further change.
Even if radical reform is adopted, it tends to be made
incremental in its implementation.
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One step further, half step back (进一步，退半步).
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Incremental social service contracting in China
1）Informal contracting has been widespread since the
1980s.
2）Formal contracting emerged in the 1990s.
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In 1995, the Social Development Bureau of Pudong New District
contracted the operation of its Luoshan Service Center to the
Shanghai Young Men's Christian Association.
3）Competitive contracting emerged in 2005.
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In 2005, the China Foundation for Poverty Alleviation selected,
through competitive bidding, six nonprofit contractors to
implement poverty alleviation programs.
In 2009, Shanghai started its competitive contracting program.
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2. State leadership
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Political, legal, and organizational foundations of equal
partnership are still weak.
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Market and social organizations depend on the state for
critical resources.
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Governments are dominant political forces and decision makers
Governments’ regulatory functions are hardly constrained
Organizational boundaries between governments and other
organizations may be vague.
Such dependence invites state’s penetration and control.
External organizations do their best to create and maintain a strong
relation with the state.
State may find an increasing conflict between its demands
for efficiency and for control.
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Pursuit of efficiency will induce changes in the control system.
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State-owned enterprises as a portion in
China’s top 500 enterprises in 2004 and 2012
100%
90%
80%
2004
2012
70%
60%
50%
No. of
firms
Revenues
Assets
Profits
In 2012, the largest private enterprise was ranked 44 in the top 500.
The no. 1 SOE was 9 times larger in its sales revenues.
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Top private entrepreneurs are being coopted
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The net worth of the 70 richest delegates in China's
National People's Congress rose to RMB 565.8
billion ($85 billion) in 2011, a gain of $11.5 billion
from 2010 (Hurun Report 2011).
That compares to the $7.5 billion net worth of all 660
top officials in the three branches of the U.S.
government.
Note: Legislators in National People’s Congress are not
employed by the state. They have their own jobs, and meet
once a year in Beijing.
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Is the state committed to CG?
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A conditional “YES”
In 2006, the sixteen-word guidelines of social management of
China (party leadership, government responsibility, social
collaboration, and citizen participation，党委领导、政府负责、
社会协同、公众参与）
In 2013, General Office of the State Council (Circular 2013, No.
96)
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A major principle of this circular: Entrust social forces do whatever they
can do well, in order to effectively improve public service provision,
quality, and efficiency.
In the economic sector, recent years’ expansion of the state
sector 国进民退 (state forwards, private back offs)
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Quick expansion of the SOEs in the market.
Quick expansion of fiscal revenues and expenditures.
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Fortune 2013, Top 10 list
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3. From economic to social areas
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Marketization preceded social liberalization and
deregulation.
Consequently, collaboration first emerged in economic
areas.
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Economic capital, economic mechanisms and economic
incentives have penetrated Chinese governments.
Entry of social capital/mechanisms/incentives into
public management is the next step.
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Growth of registered nonprofits in China
500000
Sum
400000
Social Group
300000
Nonprofit
Enterprise
Foundation
200000
100000
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
0
Most are very small, young, unprofessional, and highly
dependent on governments.
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4. Innovation and diffusion
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China has a highly decentralized government system
Local competition and learning as a major incentive of CG
innovation and diffusion
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Mimetic, normative and coercive forces all play a role.
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Wealthy coastal governments are leading innovators
 Shanghai, Zhejiang and Guangdong innovation
Spontaneous learning, professional promotion, and top-down
requirement.
Innovations often violate law but receive green lights from
the central government.
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5. From service contracting to CG
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Governments are unanimously pragmatic and riskaverse
Service capacities of nonprofits are always the starting
point of government-nonprofit cooperation.
Unintendedly, service contracting may create
foundation of CG.
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Spontaneous micro-mechanisms that link service
contracting to collaborative governance.
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1. Induced power sharing
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Incomplete contracts and implementer discretion
Induced demands for decision making
Derived delegation of regulatory functions in bundled or
discrete ways
2. Trust
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Acquired trust of contractor capacities and intention
Acquired trust (self-confidence) of government’s capacity to
manage collaboration
Growth of formal and informal accountability systems that
maintain trust
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3. Community embeddedness
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Information of and access to local residents
Entering community governance network
4. Organizational empowerment
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Nonprofit growth
Internal governance capacities of nonprofits
External governance capacities of nonprofits
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