The Unfunded Mandate of Heaven: The Center, the Cities, and the Politics of Pension Reform in China.

During the 1990s the Chinese state undertook a project to transfer public pension obligations from the enterprise to local government agencies. Pension reforms made local governments responsible for distributing benefits to retirees of urban enterprises. While an abundant policy literature has covered China's pension crisis and measures to cope with it, the process and unintended consequences of pension reforms offers fertile ground for exploring broader questions about policy implementation and power relations between central government and sub-national levels of government. This paper addresses three significant outcomes of pension policy reform in the late 1990s: 1) the inability or unwillingness of provinces to exert influence on pension policy; 2) the transfer of pension obligations from enterprises to urban governments; and 3) the erosion of once close relationships that existed between urban governments and state firms within their respective territorial jurisdictions. Each of these sheds light on the broader comparative questions of how policy legacies and state structures influence social policy reform and how economic reforms influence local government incentives and behavior. This paper is based on documentary evidence from official sources and on recent interviews with central and local officials, firm managers, and others in the cities of Changchun, Chengdu, Beijing, and Shanghai. [ABSTRACT FROM AUTHOR]