Chapter Four lays the groundwork by discussing the critical components of coal sector regulation in China, including pricing, investment approval, and capacity control. While the coal sector in China has been steered towards marketisation, government intervention, primarily through pricing regulation and investment approval, has created regulatory ambiguities and complexities for implementation. This chapter also discusses the implications of the capacity control mechanism on coal production and consumption, raising essential questions about the scope of fuel switching under the existing legal and regulatory arrangements.

The sixth chapter extends theoretical and empirical interests in understanding the role of the Chinese government through its organization of mission-oriented mega-R&D programs (MMRDs). In particular, this chapter proposes a theoretical framework with a particular focus on such programs’ three contextual characteristics – technical goal of the mission, dominant actor, and end-user. We then apply the framework to ten cases across different historical periods and sectors in different countries to test its validity. The finding suggests that exploitative R&D with a clear and singular technical goal whose performer and end-user are public actors entails government to adopt MMRDs, while in doing so the government also should take into consideration such factors as economic efficiency, national security, and public interests. In the case of China, the state-led innovation model favors to concentrate resources on initiating MMRDs.

Economists and political scientists tend to explain China’s rapid rise from the institutional perspective. There are two contrasting schools of thought: the free market school and the active government school. Both schools acknowledge that market reform has been a key factor in China’s rapid economic growth, but the active government school also attributes it to China’s strong government and its active economic intervention. These two contrasting institutional views are evaluated in Chapter 3. The short conclusion is that neither view can properly explain the Chinese growth puzzle. The free market view cannot because China’s market is not much freer than that of most developing countries. The active government view cannot either because China is not particularly well ranked in terms of government effectiveness. There are many other institutionalists who hold more fine-grained views than the above two schools. Some of these views are also evaluated in the chapter, which concludes that institutional and policy factors may be important contributors to China’s economic growth, but they are not the differentiating factors that have made China grow faster than all other countries.

Although the roots of subsidiarity predate Christianity, we can usefully explore encyclical teaching to appreciate how the Catholic Church has given intelligible expression to this concept in the midst of her broader social teaching. The paradox of subsidiarity is that it mandates contradictory things: requiring on the one hand that the state should not interfere with the internal life of civic associations and on the other hand that the state should provide assistance to those associations when such assistance is necessary. Rather than using the language of "positive" and "negative" subsidiarity (which, it is argued, is not especially helpful because it perpetuates the sovereigntist tendency to see the state as the locus of all authority), this chapter focuses on how the encyclicals illuminate (1) the nature of subsidiarity, as neither freestanding nor abstract; (2) subsidiarity’s political purposes (increased participation in decision making by actors who are more proximate to need and therefore better placed to reach good outcomes more efficiently), moral purposes (protection of associational freedom and avoidance of totalitarianism), and final purposes (protection of that charity which can never be mediated through bureaucracies); and (3) the operationalisation of subsidiarity, which can be promoted or inhibited through the action of law.

The common good (bonum commune) has, since antiquity, referred to the aim of social and political association, and was particularly prominent in medieval Christian political theology. Since St. John XXIII’s 1961 encyclical letter, Mater et magistra, ecclesiastical statements about social teaching have employed a formulation of the common good, usually in the version that appeared in the Second Vatican Council’s 1965 Pastoral Constitution for the Church in the Modern World, Gaudium et spes, as “the sum of those conditions of social life that allow social groups and their individual members relatively thorough and ready access to their own fulfillment.” This chapter discusses the origins and development of this formulation as well as the ways that it has been used in subsequent Catholic Social Teaching. While it has sometimes been interpreted as an “instrumental” account of the common good, the sources and uses of the notion suggest that it is the particularly modern political component of a fuller notion of the common good continuous with the tradition. In particular, the recent formulation is concerned to limit the power of the modern state and protect the dignity of the human person in the challenging conditions of political modernity.