China and Capitalism: A History of Business Enterprise in Modern China, by David Faure. Hong Kong: Hong Kong University Press, 2006. ix + 127 pp. US$39.50 (hardcover), US$15.95 (paperback).
Commerce and Capitalism in Chinese Societies, by Gary Hamilton. Abingdon: Routledge, 2006. xii + 309 pp. £75.00 (hardcover), £20.99 (paperback).
These books represent collections or summaries of previously-published work by mature and productive scholars. Both books are concerned with the differences between Chinese and Western business practices since the 18th century. Both take for granted the extensive commercialization and economic sophistication that have marked the Chinese economy for several centuries, and try to make the areas of similarity and of difference between the two types of economy clear and comprehensible.
According to the publisher, the book by David Faure is intended to be read by people with little background in China or familiarity with Chinese business practice. Although Faure refers to capitalism, the substance of the book is better indicated by the subtitle-it is about business in China from the late Ming Dynasty to the 1990s. The book consists of 98 pages of text, 20 pages of notes, and four pages of suggested further reading. The six brief chapters, each of which was previously prepared as an independent essay or lecture and which tend therefore to repeat several main points, deal with the historical development of the "modern firm" (a limited liability corporation operating under commercial law and marked by freely traded shares) in China. The core of the book is Chapter 4, "Company Law and the Emergence of the Modem Firm", which refers to the development of the body known as an incorporated company (gongsi) and the legal framework exemplified by the passage of the Company Law (gongsi fa) in 1904.
The material is organised by contrasting a "traditional" style of Chinese business, prevalent in the 18th and 19th centuries and characterized by personal trust and official patronage and by economic enterprises organized as ritual or lineage corporations, with a "modern" style characterized by the modem firm, impersonal capital markets, large-scale banking and an elaborate framework of commercial law. He notes that, although the 18th and 19th century Chinese excelled at commerce, they did not have the institutions such as a national debt, stock markets or banks issuing paper currency that would permit the concentration of the large amounts of capital necessary for industrial development. Faure is very dubious about the relevance of Confucianism or Chinese traditional values to economic development or to the history of business. He notes that Chinese society from the 18th century on was pervaded by the pursuit of profit, and devotes his attention to such matters as accounting practices or changes in the meaning of the term gongsi.
Although Faure's book is short, it is not an easy read. Nor, despite the publisher's assurance, is it a book that I would recommend to someone who has little background in Chinese history or familiarity with Chinese business. It assumes a considerable knowledge of such things as the organisation of the Qing state, the political position of Zeng Guofan in 1867, or the post-1895 series of political reforms. Many things are mentioned briefly, or alluded to, but few are spelled out in any detail. It is heavily footnoted, so one could no doubt track down and read many of the sources (in Chinese and English), after which the text might well seem rather less gnomic. My overall impression was that it was like reading someone else's lecture notes, which in a way is exactly what one is doing; this particular volume does not stand on its own.
The book by Gary Hamilton reviewed here consists of eleven chapters, all published from 1977 to 2003 in edited compilations or as journal articles. Most date from the 1990s. It also features a massive bibliography of works in English and, in smaller numbers, Chinese (pp. …