Redefining state and market: Urban housing reform in China

Abstract

China's housing reform has attracted much attention in recent years. A great body of literature has been produced. Few topics are more central to the reform issues than the relationship between state and market. This paper examines the relationship between state and market, and the changing roles of state and market in the housing reform process. The concepts of the model of demand and the model of powers are used to explain the interaction of state and market in the process of China's urban housing reform. It also argues that state actions can improve the working of the market as well as distort the market. The incentives and feedback of the market can help the state work more effectively, but the growth of market also deconstructs the state further. When the market grows and gainers in the market form political forces that make reform move towards the market, the role of state moves towards that of enabling, facilitating and steering.