Agentic Regions: Institutional Change and Economic Development in Coastal China

Scholars have long debated whether geography or institutions best explain divergent economic development. This paper examines coastal China’s “great reversal,” in which historically poor provinces outpaced once-prosperous ones after 1978, and argues that geographic endowments and antecedent institutions function as structural resources whose developmental impact depends on how collective regional agency mobilizes them. Drawing on one year of fieldwork across eight coastal provinces—supplemented by interviews, oral histories, memoirs, and macroeconomic data—the study shows how distinct state–business coalitions leveraged region-specific resources to pursue tailored development strategies and institutional innovation, setting in motion long-term economic trajectories. In the 1980s, four types of coalitions emerged: bottom-up or FDI-driven market-crafting, state-restoring, and weak coalitions. On the eve of nationwide privatization in the late 1990s, provinces with market-crafting coalitions had already built robust market infrastructure and thus experienced “privatization after capitalism” and sustained growth, while those with state-restoring or weak coalitions underwent “privatization without capitalism” and stagnation. These findings challenge the conventional view of China’s reform as uniformly gradual, showing instead that some provinces followed gradualism while others experienced de facto shock therapy.