ABSTRACT
The first Special Economic Zone (SEZ) in Shenzhen, set up in 1979, was hailed as a laboratory for capitalism in China. The Chinese government settled on the name ‘Special Economic Zone’ rather than the then commonly used term, ‘Export Processing Zone’ (EPZ), which was considered more clearly capitalist and narrower in focus (Lu 2008). By 2003, an estimated 100 special zones or more were recognized by the central government (Naughton 2007: 410). Debates on the meaning, the role, and the future of SEZs have continued unabated since the first one was set up in China (Crane 1994). One of the latest debates on SEZs is whether they have fulfilled their historic mission in China, now that a full-blown market economy has emerged there, confirmed by official membership in the World Trade Organization (WTO) in 2001 (He 2009). This chapter does not engage directly with these debates. Instead, I argue
that the SEZ, as a laboratory for experiments in capitalism, has had a real demonstration effect on the rest of the Chinese economy, which in 1979 was still very much oriented to central planning (Gallagher 2005). In particular, SEZs were the first instances where laws, rather than the Chinese state, became the lead regulatory mechanism in labour allocation. Now the Chinese state as a whole not only exhibits an increasingly marketized economy, but also uses law as the specific regulatory mechanism to govern the labour market (Potter 1994). This is not to suggest that an Anglo-American labour market has taken
root in China. One of the clearest signs of this has been the ongoing importance of institutionalized brokerage between employees and employers amidst the emergence of a genuine labour market. This observation of a simple difference is not offered in praise or in criticism. But beyond that observation, I do suggest that in some important respects the newer forms of mediating agencies that have emerged, particularly temporary employment agencies, have had the effect of making regulation of the Chinese labour market less effective overall than it could be. In addition, the intensified logic of so-called ‘flexible production’ in SEZs
to date and global capital’s powerful need for flexible and cheap labour, both unskilled and skilled, has made it exceptionally difficult to regulate the labour market in SEZs. Further, effective regulation depends on rule-implementing
and rule-adjudication, in addition to rule-making. Because of the relatively limited independence of the judiciary and because of the historical legacy of close relations between business and local government, implementation and adjudication of laws are generally less effective than the making of them in China (Lee 2007). These features of SEZ regulation in China remind us that regulation
in general (like law in particular) is not simply a compilation of rules and standards. If we turn to consider the implications of regulation for society, it is also noteworthy that particular forms or kinds of regulation also tend to produce particular kinds of subject – that is, particular kinds of social identity that shape individuals and groups in their characteristic actions. In the contemporary Chinese turn to law as regulation, the subject that is intended is one that is attractive to global capital. Specifically, this subject is a member of a labour force, a subject that in a very specific sense is ‘disciplined’ and at the same time ‘self-governing’ (Foucault 1991). In turning to laws as regulatory mechanisms, and in formulating them in
particular ways, the Chinese state has consulted intensively with international organizations such as the ILO and the World Bank (Bottelier 2007). This consultation covers best practices and international standards for regulating the labour market. The extent of this consultation contradicts a commonly held assumption in the West that China necessarily opposes outside influence. The dominant consideration affecting government responses to these outside influences in technical matters appears to be whether the measures are presented as imposed and mandatory. While this exchange of non-binding technical practices is crucial with respect to the state, it is not the only outside influence that has a bearing on changes in China’s labour market. Alongside the reform of state law and regulation, international NGOs such as Asia Labour Watch and Human Rights Watch have been pressuring foreign capital in China to adopt international standards (both public and private) of corporate social responsibility. So this chapter is about laws, rules, and standards as regulatory mechan-
isms in China’s emergent labour market, with SEZs acting as a laboratory for experimentation. New forms of mediating bodies such as temporary staffing agencies play an active role in this market. The restructuring of this crucial aspect of the Chinese economy fits into the overall goals for the Chinese state over the past three decades: to retreat from the active, coercive administrative measures typical of the Maoist period, and to move towards a more stable role of regulating relatively autonomous markets. But I suggest that some important aspects of the newer forms of mediating agencies have had the effect of making regulation less technically effective. The first part of the chapter is a brief discussion on SEZs. The second part
discusses tensions among stakeholder interests in SEZs. The final section looks at the social and economic sustainability of an economic development model based on cheap labour and export-oriented industrialization, and the inherent difficulties of accountability and regulation associated with China’s
law
place in global supply chains. I use temporary staffing agencies as an example to illustrate the point.
