State-Building, Graduate Institutional Change, and Extractive Capacity in Vietnam and China

Zhihang Ruan, Hunter College, CUNY

When do state-building efforts limit state capacity? This paper draws on the comparison of the land institutions in Vietnam and China to answer this question. At the critical juncture of constitution-making in the late 1970s and early 1980s, Vietnam established state ownership of all land, while China nationalized only urban land, not rural land (Ruan 2023). However, until the recent decline of the real estate market in China, the Chinese government has been able to raise significantly more revenue from land sales (measured as land sale revenues divided by GDP) and thus has a stronger fiscal capacity than its Vietnamese peer. Why? Using historical archives of the Prime Minister’s Office, the National Assembly, and various ministries of Vietnam, supplemented by extensive existing literature on land institutions in China, the paper traces the evolution of land institutions and the state’s capacity to extract revenues from land between the early 1980s and the 2010s. It argues that the stipulation of land ownership in the constitutions of both countries has limited the scope for direct institutional change and prompted gradual change, such as layering and drifting (Mahoney and Thelen 2009), in similar directions in the two countries. However, the state ownership of all land in Vietnam reduced ambiguity about land, making reinterpretation more difficult. Instead, the partial nationalization in China gave the government greater flexibility to differentiate land, enabling it to monopolize the urban land market and extract significant revenues from it. The findings contribute to our understanding of the causes of gradual institutional change. It also enhances our understanding of the complex relationships between nationalization, state-building, and state capacity. It also provides a comparative lens for understanding the reforms and transitions in Vietnam and China since the late 1970s.

No extended abstract or paper available

 Presented in Session 166. The Chinese Reform as Social Science History (II): Temporality and Contingency