Small Banks, Big Politics: The Causes and Consequences of Bank Proliferation in China

Conventional wisdom holds that banking markets flourish where property rights are secure, the rule of law is strong, and the state keeps its hands off. China has none of these. Yet over the past three decades, the number of Chinese banks grew exponentially, and competition became fierce. Why?

Adam Y. Liu argues that China’s banking sector is a market of the state, by the state, and for the state, and that its banking market grew not despite authoritarian rule but because of it.

Liu is the author of “In Authoritarian Markets: The Politics of China’s Banking Explosion” (2026). Drawing on a decade of fieldwork and extensive original data, he uncovers the political logic behind the development of banking markets in China and other authoritarian states —and explores what it means for the future of China’s economy.

Speaker:
Adam Y. Liu, Assistant Professor of Political Science, Lee Kuan Yew School of Public Policy, National University of Singapore

Moderator:
Victor Shih, Professor, and Ho Miu Lam Chair in China and Pacific Relations, UC San Diego School of Global Policy and Strategy

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This public lecture is organized by the 21st Century China Center (21CCC) at the UC San Diego School of Global Policy and Strategy. For more information about this and other 21CCC events, please visit china.ucsd.edu.