State Formation and Bureaucratization: Evidence from Pre-Imperial China
State Formation and Bureaucratization: Evidence from Pre-Imperial China Joy Chen∗ Cheung Kong Graduate School of Business August 7, 2019 Abstract How does one build a centralized bureaucratic state? A dominant view is that wars incentivize rulers to directly extract resources, thereby increasing state capacity. The Chinese empire, one of the earliest states to develop a centralized bureaucracy, can pro- vide useful insights. Using hand-collected data, I present the first systematic evidence on patterns of warfare and state-building in pre-imperial China. I then develop an incomplete contract model to study ruler’s and agent’s incentives at war, and demon- strate that ownership of land and type of military conflict both affect state-building. External military pressure dampens centralization, as land-owning agents have more to gain from a successful defense, and therefore become more committed. Under cer- tain conditions, centralization is more aggressive at offense, as non-land-owning agents are more willing to participate in attacks because they have less to lose. A decrease in the agents’ bargaining position also facilitates state-building. Empirical tests and historical examples are consistent with model predictions. ∗I am indebted to my advisors Avner Greif, James Fearon, Saumitra Jha and Avidit Acharya for their guidance and support. This work benefited from helpful comments and suggestions from Ran Abramitzky, Shuo Chen, Yiwei Chen, Robin Gong, Yu Hao, Mark Koyama, Xiaohuan Lan, Mark Lewis, Debin Ma, Eric Shi, Yang Xie, Leslie Young, Anthony Lee Zhang, Xiaoming Zhang, Fenghan Zhu, and seminar participants at CKGSB, Fudan, Peking University, Stanford, SUFE, Tsinghua, the All-UC Economic History Workshop and the International Symposium of Quantitative History.
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