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Table 1 The two-sided authority of the government

From: The allocation mechanism of authority and accountability in Chinese government hierarchies: A case study of the “Earmarked Project System”

  Production Extraction
Small size Solve market failure
Supply public goods
National defense
Legal order
Property rights
Public Health
Promoting social equity and protecting the poor
Eliminating diseases
Strict budget constraint and supervision
Middle size Solving externality: Elementary Education Environment protection Control monopoly: Law of public service Policy of antimonopoly Information regulation:
Insurance Consumer protection
Providing social insurance
Unemployment insurance
Unconditional grants
Unfixed income;
Extra-budgetary income ; non-budgetary income ;
“Implicit Tax”
Large size Coordinating private activities
Promoting market
Multiple regulations
Asset redistribution
Comprehensive extraction
Human capital
State as a super company
  1. Source: Adapted from World Bank 1997