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XC's avatar

I grew up in Shanxi during the 1990s and early 2000s, the so-called gilded period created by the coal and electricity boom. I attended an elite school there (It's ostensibly a public school, but admission requires guanxi— in my case, my father's acquaintance, who was a mayor at the time.). Looking back, the most astonishing scene was the school run, where I saw more Bentleys and Rolls-Royces than I have in all my years living in the UK since.

An interesting and non-trivial detail in your story about the coal industry is that, in the past, a significant portion—likely the majority—of the mines were operated by businessmen from southern provinces, particularly Zhejiang and Fujian, often in collaboration with locals.

Legatvs Silanvs's avatar

I've written much on the political economy of Beifang as a whole. Northern China is currently stuck in a conflict between rentier bureaucrat-controlled SOEs on one end, and a local society of small business owners and freeholders on the other. Local society in Beifang has always been personalistic and particularistic, what @vizierprime calls "guanxi". SOEs however distorted that system by crowding them out, in contrast with Southern China where the clans captured local CPC control by the latter's acquiescence, leading to clan domination of markets and commerce. Shanxi in particular saw SOE crowding out lead to a proliferation of gangsters and bandits who worked at the employ of bureaucrats.

It is a rather tragic episode, what could have been an Asian Third Italy got stuck instead in this infestation.

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