Shanghai between state and market in urban transformation

Economic liberalisation has brought fascinating changes to China's urban development by undermining state control and introducing market forces to economic decision-making, raising the fundamental question of what are the current roles of state and market in urban transformation. By using Shanghai as an example, this paper argues that the stereotype perception of rigid state intervention is no longer applicable towards an understanding of China's urban transformation. The same is true of the overwhelmingly described market influences. Rather, urban development in contemporary China is shaped by the interplay between state and market. The state plays the key role in determining the timing, the pace and the economic and spatial configuration of Shanghai's development, while the market is an indispensable part in central and local state decision-making. With the continuous reform and economic liberalisation, China is moving towards a small government and a sea of private enterprises. Whether and how the state remains in firm control, and how the state and market interact with each other in shaping China's urban transformation remains to be seen in the present century.