ABSTRACT

This chapter proposes that legal and economic reforms give rise to and reinforce each other in China. It argues that legal development in China should be viewed as an evolutionary process alongside incremental economic reforms undertaken during its transition from central planning. The chapter examines law and market literature and how China appears to be an 'outlier', before providing a comparative view of China's legal system versus common law and civil law countries. It focuses on China's particular sequence of legal, institutional and economic reform. The chapter accounts for the influence of the global rules-based system that is gradually emerging and gained prominence around the same time as China's integration into the international system after years of inward-focused development. It examines several aspects of the relationship between law and economic growth in China. The chapter assessed the theoretical and empirical relationship between laws and the development of markets across countries, spanning currently developed, developing and recently transitioned economies.