Transforming Rural China: How Local Institutions Shape Property Rights in Rural China

In October 2002, on a gray Wednesday morning in Taipei, a curious fax spooled into the offices of one academic and a dozen small- to medium-sized Taiwan enterprises. "This Friday at the Grand Hotel we will treat our Taiwanese compatriots. Your business friends and clients are welcome to join us," the fax read. It was signed Huang Song, the party secretary of Mei township, one of the 23 townships of Wujiang City in Suzhou municipality. On the trip to Taiwan he was acting as the head of a seven-person delegation of mainland Chinese officials.

The invitation was, for all intents and purposes, extremely sensitive. Just two weeks prior, a Jiangsu delegation had strung up a red banner in front of the Taipei Grand Hyatt Hotel welcoming Taiwanese investors. "Conference to Welcome Taiwanese Investors in Jiangsu" it read. Taiwan's government promptly deported the party for illegal activities. Under Taiwan government regulations, mainland Chinese are only allowed onto the island in tour groups coming from a third country. Three months before their arrival they must submit an itinerary with their application for a travel permit. The Chinese visitors must strictly follow this itinerary, in which soliciting investments and business dealings are strictly prohibited. The gray areas are, of course, many in a democracy. Taiwan's investigators and officials would have a hard time prosecuting Chinese visitors for meeting with local "friends" as long as everything remained low key and non-commercialized.

The red banner advertisement and a high profile and publicized event had gone a bit too far. Three weeks later, Huang Song knew as much, and knew the government was watching them. Just days earlier one local news-paper had reported their arrival. A short two-inch column buried on the inside pages noting that the Mei township delegation had arrived and was traveling around the island. Although the placement of the article would not call much attention, it was publicity all the same, and one morning Huang Song awoke to find that single page under his door, the article circled in bright yellow.

This is all to say, that Huang Song and his delegation were not just tourists curious over the Taiwan scenery. They had come to woo

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