| Summary/Abstract |
Why do local officials in China often fail to comply with directives of the central leadership in Beijing? Existing scholarship suggests that local defiance results from reform-era decentralization, or from the difficulty of managing agents in a complicated policy environment. In contrast, we conceptualize threats by Beijing to punish local officials as deterrence signals, and analyze local officials’ reactions to these signals as a dynamic process in which they consider the selectiveness, severity and retractability of sanctions, and the reputation of the center, when deciding to defy. Examining the case of Beijing’s application of the seemingly powerful “hold-to-account” practice to curtail investment in iron and steel in 2004, its punishment of local officials in the “Tieben Incident”, and the continued defiance of other local officials, we analyze the dynamics of central–local relations that lead to the failure of the center’s deterrence efforts.
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