You’re not wrong. I forgot about the hukou system. It’s also true that China’s government is more involved with large-scale businesses. You have to play more politics to build a business empire in China than in the USA.
Otherwise, especially when it comes down to small fry (which are the majority of businesses), national politics is just one aspect of the business environment. Also important to small businesses is things like paperwork, regulation and—perhaps most importantly—the chance of getting sued. The United States is a very litigious society where you (usually) have to pay high legal fees even if you win. China is less litigious because it is rare for anyone in their right mind to willingly call down attention from the government.
China is not known for its worker protections and environmental regulations. There are far fewer zoning laws in China than the United States. I reckon mundane annoyances are more likely to kill a small business than is a visit from the secret police. (This is not necessarily a bad thing. I like living in a city with breathable air.)
I also suspect organized crime plays a bigger role in China than in the United States for small businesses. This isn’t a good thing, but it does technically fall under “low government involvement”.
You’re not wrong. I forgot about the hukou system. It’s also true that China’s government is more involved with large-scale businesses. You have to play more politics to build a business empire in China than in the USA.
Otherwise, especially when it comes down to small fry (which are the majority of businesses), national politics is just one aspect of the business environment. Also important to small businesses is things like paperwork, regulation and—perhaps most importantly—the chance of getting sued. The United States is a very litigious society where you (usually) have to pay high legal fees even if you win. China is less litigious because it is rare for anyone in their right mind to willingly call down attention from the government.
China is not known for its worker protections and environmental regulations. There are far fewer zoning laws in China than the United States. I reckon mundane annoyances are more likely to kill a small business than is a visit from the secret police. (This is not necessarily a bad thing. I like living in a city with breathable air.)
I also suspect organized crime plays a bigger role in China than in the United States for small businesses. This isn’t a good thing, but it does technically fall under “low government involvement”.
[Edit: Fixed typo.]
According to the World Economic Forum website:
https://www.weforum.org/agenda/2019/05/why-chinas-state-owned-companies-still-have-a-key-role-to-play/