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Why have administrative reforms failed to improve the governance of China's energy sector? This article argues that, in the context of China's partial reforms, strategies for revamping China's energy sector have oscillated between centralization and decentralization, creating a diverse array of stakeholders without providing any institutional coordination among them. In addition, corporatized state-owned enterprises have their own commercial interests, giving them incentives to capture industrial regulators. As a result, regulatory capture has become a serious threat to the governance of China's energy sector. The findings of this study carry implications for our understanding of regulatory development in transitional economies. [ABSTRACT FROM AUTHOR]

The article discusses the results of economic reform in China, examining the financially disadvantaged small and medium-size enterprises, and exploring the profitable state-owned enterprises (SOEs) which also developed as a result of the reforms. Due to the reforms, the authors state, the productivity and efficiency of SOEs have been improved. Other topics include the debate on whether China should adopt the market economy approach and the decision made in 1992 that China would establish a socialist market economy.