Parties, State Capacity and Economic Development: the Changing Government-Market Relationship

Abstract

Political parties, as political organisations, always represent and aim to achieve the interests of a particular class, base or group. The party system, as a legitimate way for political parties to assume, participate in and influence State power, exhibits rich diversity depending on the specific conditions of each country. Meanwhile, as an essential part of the national system, the ruling political Party and its party system play a central role in the country's economic development. In the current context, a single political party system and its economic policies can no longer adapt to the trends of political and economic globalisation and multipolarity, and the comparison of governing experiences and laws among political parties and the exploration of governing laws have become a top priority in the pursuit of national development. In this context, based on the fact that China and the United States which together have global influence, this paper first critically reviews the theoretical explanations of studies on China's economic development and some studies based on China's practical characteristics, and proposes the importance of political parties and state capacity. The paper then summarises and proposes that the institutional characteristics of political party organisations and their governing capacity are the institutional basis of state capacity to promote economic development and market formation and development, and explains the above ideas from the perspective of market formation and development, discussing future challenges and suggestions for improvement.