The contemporary Chinese financial system encapsulates two possible futures for China's ecomy. On the one hand, extremely rapid financial deepening accompanied by relatively stable prices are both manifestations of a vigorous growth trajectory that will one day make China the world's largest ecomy. On the other hand, the colossal store of n-performing loans in the banking sector augurs a troubling future. Factions and Finance in China inquires how elite factional politics has given rise to both of these outcomes since the reform in 1978. The competition between generalists in the Chinese Communist Party and politically engaged techcrats over monetary policies has time and time again prevented inflation from spinning out of control. Shih shows that elite politics has exerted a profound impact on monetary policies and banking institutions in contemporary China.
Victor C. Shih is a political economist specializing in China at Northwestern University. Born in Hong Kong, Professor Shih immigrated to the United States at the age of 12. He attended the George Washington University on a University Presidential Fellowship and graduated summa cum laude in East Asian Studies with a minor in Economics. He went on to complete his M.A. and Ph.D. in Government at Harvard University. He is the author of numerous articles appearing in academic and business journals, including The China Quarterly and The Far Eastern Economic Review, and advises the private sector on the banking industry in China. His current research concerns the political economy of fiscal transfers in China and Chinese policies toward ethnic minorities.