The state project of crisis management: China's Shantytown Redevelopment Schemes under state-led financialization

Since 2008, China has introduced state-led financialization to inject low-interest, stable and long-term loans to facilitate urban redevelopment through national shantytown redevelopment schemes (SRSs). Extending critical state theories to China's transitional economy, we consider SRSs to be a policy model of the state project (mode of policy-making) of crisis management that aims to revitalize the national economy in the wake of the global financial crisis. Essentially, this state project serves to tackle the legitimation crisis threatened by both the economic crisis and the escalating social discontent. Drawing on an empirical study of Chengdu, a regional hub in western China spearheading SRSs, this paper examines how the Chinese state at different levels interacts with the nascent financial market in the creation of a new "model" of urban redevelopment under state-led financialization. Having been exploited to manage economic and legitimation crises, this model has simultaneously become a source of "crisis of crisis-management" owing to the state's "over-intervention". This research contributes to a fresh understanding of the multiplicity of financialization by linking the financialization of urban built environment with the financialization of the state project, in which financial motives and practices shape the mode of policy making. The Chinese experience also presents a decentered interpretation of state-led financialization that renews our understanding of the multifaceted state and state projects, particularly the hybridized, often contradictory motivations and socio-economic outcomes of state interventions.