Abstract

"“Little Taipei on the Mainland”: Self-Made Kinship Capitalism and the Rise of China’s Wealthiest County, 1978-2000"

Zhaojin Zeng, Duke Kunshan University (zhaojinzengpitt@gmail.com)

A 2019 state television report praised the contribution of the Taiwanese to Kunshan's rapid economic growth and hailed the Chinese city as “Little Taipei.” Previously a poor and predominately agricultural county in eastern Jiangsu in the Mao era, Kunshan now boasts 4,800 Taiwanese companies and more than 100 thousand Taiwanese residents. It also has become one of China’s wealthiest cities. In 2021, Kunshan yielded a GDP of 474.8 billion yuan, surpassing both old industrial centers such as Lanzhou and Taiyuan and new coastal development zones such as Zhuhai and Shantou. How does Kunshan’s rise take place? Why do Taiwanese investors choose Kunshan as their destination over other cities? In what ways does Taiwanese business contribute to the emergence of a regional economic miracle in eastern Jiangsu? This paper draws on a wide range of primary sources, such as local government documents and oral history material, to examine the grassroots business and social forces that have powered Kunshan’s remarkable transition since the late 1970s. We identify two sets of factors: entrepreneurial cadres and transnational networks of capital and technology. Entrepreneurial-minded cadres devised preferential policies to attract Taiwanese firms. Those early comers expanded business, technology, and social networks that continued to pull the flows of capital and human out of the island. A developmental alliance between local cadres and Taiwanese businesspeople gradually took shape, leading to a unique developmental model termed “self-made kinship capitalism” in Kunshan. Unlike Shenzhen and other coastal cities in the south, where pre-existing kin relations and ethnic connections were utilized to draw Hong Kong's capital to the mainland, the experience of Kunshan demonstrates that such kinship ties can be consciously forged and remain effective in generating long-term economic growth.