Elite or State: Grain Prices, Social Conflicts, and Provision of Public Goods in Eighteenth-Century China

We examine the different functions of the government and of local elites in eighteenth-century China by considering their responses to grain price fluctuations, which were the largest shocks to traditional agrarian society. Descriptive evidence has indicated that both the government and the local elites provided public goods that mitigated high grain prices and maintained social stability. However, few studies to date have quantitatively compared the importance of these two types of service. We construct a prefecture-level set of panel data from 1742 to 1795 to compare the effects of government-managed granary with the effects of community services provided by local elites, and we show how these effects varied by region. The results show that although higher grain prices commonly led to increased conflict across China, this pattern did not apply in the most prosperous regions, namely the North and the Lower Yangzi. This set of findings suggests the existence of effective interventions to deal with food-supply crises. Further investigations show that although the government played a dominant role in the North, the local elites were more effective for reducing price fluctuations in the Lower Yangzi. We also provide several explanations for the different patterns of crisis relief found in the two examined regions.