Process And Mechanism Of Institutional Change In The Context Of Social Transition

Great changes have been going through China since1980’s. The old planned economy system is experiencing amazing transformation that has shocked the world. A limited free market economy, characterized by free capital and free space, has been emerging and excerting an increasingly influence on China’s social structure. During this market transformation, state-owned enterprises (SOEs), a main economic subject of the old economic system shifting from planning to marketing, witnessed a large-scale property right system reform under the influence of both policy and market and will eventually embrace modern enterprise system with market characteristics.In a short span of more than30years, China have achieved great progress that had been made in western countries for hundreds of years, which could be called a compressed market transformation. During this transition, how would SOEs change? To be specifically, how could an enterprise change from an SOE to a private company in the sense of formal structure? And how would its internal mechanism respond to this change in the sense of informal structure?Through a6-month field work, including participant observation and deep interview, in a private company in Shenzhen Special Economic Zone, the author describes its development and analyzes its process of shifting from an SOE in the background of market transition. With theories from economic sociology and economic anthropology, the author argues that in the sense of formal structure of an enterprise, property right transition brought both challenges and opportunities. New social powers have emerged from this process and society has been restructured. In addition, reform has been shifted from top-down to multi-directions. In the sense of informal structure, its internal organizational structure and organizational system would be made use of to respond to the changing market environment. This compressed transition would keep its original system, social values and behavior patterns in different extent, giving organizational changes a kind of memory, which would keep the enterprise influenced by previous political, social and cultural factors for a long time.