Political Legitimacy and Global Capital Markets: Malaysia's 1MDB

Meg  Rithmire; Courtney  Han

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Case | HBS Case Collection | March 2020

Political Legitimacy and Global Capital Markets: Malaysia's 1MDB

by Meg Rithmire and Courtney Han

Keywords: Malaysia;

Language: English

Format: Print

34 pages

Educators

Citation:

Rithmire, Meg, and Courtney Han. "Political Legitimacy and Global Capital Markets: Malaysia's 1MDB." Harvard Business School Case 720-030, March 2020.

About the Author

Meg Rithmire

F. Warren McFarlan Associate Professor of Business of Administration

Business, Government and the International Economy

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Case | HBS Case Collection | September 2020

China's Management of Covid-19 (B): Victory?

Meg Rithmire, Courtney Han, Meg Rithmire and Courtney Han

Keywords: coronavirus; pandemic; China;

Citation:
Rithmire, Meg, and Courtney Han. "China's Management of Covid-19 (B): Victory?" Harvard Business School Case 721-008, September 2020. View Details

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Case | HBS Case Collection | September 2020

China's Management of Covid-19 (B): Victory?

Meg Rithmire, Courtney Han, Meg Rithmire and Courtney Han

Keywords: coronavirus; pandemic; China;

Citation:
Rithmire, Meg, and Courtney Han. "China's Management of Covid-19 (B): Victory?" Harvard Business School Case 721-008, September 2020. View Details

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Article | Studies in Comparative International Development | September 2020

The Rise of the Investor State: State Capital in the Chinese Economy

Meg Rithmire and Hao Chen

The nature and extent of the role of the Chinese state in the economy is fundamental to many empirical and theoretical debates about that country’s political economy. We document and explain the rise of a novel form of intervention on the part of the Chinese state: the expansion of state capital beyond ownership of state firms. We argue that state investment as a mode of state intervention in the economy is conceptually distinct from both “state capitalism” and the “developmental state” in its introduction of new agents to distribute state capital to firms and new mechanisms through which states, especially authoritarian ones, monitor and influence business actors. We document the growth of the investor state in several ways. Case studies of three high-profile shareholding firms in China demonstrate that state capital can be deployed strategically, for example to respond to financial crisis or facilitate industrial upgrading, but also generates moral hazard, resulting in corruption and resource misallocation, and international alarm about the intentions of Chinese firms. We further compare the rise of state shareholding firms in China to similar phenomena in Brazil and Malaysia, concluding that the practice has both economic and political logics.

Keywords: China's political economy; state shareholding; state-business relations; State capitalism; China's financial system; Economy; Business and Government Relations; Finance; System; China;

Citation:
Rithmire, Meg, and Hao Chen. "The Rise of the Investor State: State Capital in the Chinese Economy." Studies in Comparative International Development 55, no. 3 (September 2020): 257–277. View Details

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Political Legitimacy and Global Capital Markets: Malaysia's 1MDB

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