The dichotomy in the economics of transition literature with regard to the reform speed (Gradualist vs Radical Approach) and reform strategy (incremental reform vs structural reform) fails to capture the essence of the transitional process of a transitional economy that was ever under the...

This paper constructs a simple model to reveal the trade-off between decentralized and centralized governance structure of large state-owned enterprises (SOEs) in China. Our model shows that the delegation of decision making authority to SOE managers would enhance their initiative in terms of...