A historical review of the control of corruption on economic crime in China
| DOI | https://doi.org/10.1108/JFC-08-2015-0042 |
| Pages | 4-21 |
| Published date | 04 January 2016 |
| Date | 04 January 2016 |
| Author | ENZE LIU |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
A historical review of the control
of corruption on economic crime
in China
Enze Liu
Institute of Advanced Legal Studies, University of London, London, UK
Abstract
Purpose – The purpose of this paper is to provide a historical review of China’s anti-corruption efforts,
from the ancient period of Chinese slavery societies to the late 1970s before China launched its profound
economic reform, under the current status of the harsh crusade against corruption that the Chinese new
leadership initiated.
Design/methodology/approach – This paper is mainly based on a great deal of historical literature
and empirical ndings, with relevant comparative analysis on policies and regulations between various
periods of China.
Findings – The phenomenon of corruption has existed in Chinese history for thousands of years,
throughout Chinese slavery societies, feudal societies, republic period and the People’s Republic of
China (PRC). Anti-corruption laws formed an important part of ancient Chinese legal system, and each
dynasty has made continuous and commendable progress on ghting such misconduct. Innumerable
initiatives have also been taken by the ruling party Chinese Communist Party (CCP) since the founding
of the PRC. The PRC government created various specially designed government organizations and a
series of updated regulations for preventing economic crimes. They have realized that periodic
movements against corruption would no longer be helpful, and the paramount issue nowadays is indeed
how bold the leaders are in striking out those unhealthy tendencies.
Originality/value – This paper lls in the blanks in the Western world with a comprehensive
description of, and comments on, the historical efforts on China’s corruption and economic crime
prevention. It also, in various ways, provides meaningful information that links to China’s current
furious war against corruption.
Keywords China, Corruption, Chinese law, Economic crime
Paper type Research paper
China in today’s world is probably the most dynamic economy in the world and is
widely predicted to be the dominant economy within the next decade. As the largest
emerging market, China’s every move towards ghting economic crime will have far
more inuence on the world than ever before. It is perhaps partly because of this, the new
leadership of Chinese Communist Party (CCP) led by President Xi Jinping has robustly
initiated an anti-corruption campaign as soon as he took over as the party chief in the
end of 2012. Yet, during this ongoing campaign, President Xi has many times pointed
out the signicance of “researching our anti-corruption history, understanding the
culture of our ancient clean governments and reevaluating the gain and loss of past
anti-corruption crusades” (Xi, 2013,2014;Xinhua News, 2013;People’s Daily, 2014).
What is more, the widely regarded leading warrior of this anti-corruption crusade,
JEL classication – G14
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JFC
23,1
4
Journalof Financial Crime
Vol.23 No. 1, 2016
pp.4-21
©Emerald Group Publishing Limited
1359-0790
DOI 10.1108/JFC-08-2015-0042
Wang Qishan, the head of Central Commission for Discipline Inspection (CCDI), who
started his career as a researcher in history at Chinese Academy of Social Science after
completing his rst degree in historical studies, has also at various occasions
emphasized the importance and necessity of looking back into the past before moving
forward. Consequently, this paper will examine the fertile history on China’s
anti-corruption efforts.
Professor Barry Rider once said: “attitudes to corruption in China are about as mixed
as a good chop suey!” (Rider, 2013). China becomes the focus of this study not because
China is particularly prone to corruption. Virtually, corruption exists in all societies,
whether it is socialist or capitalist, developed or underdeveloped. However, China is
unique in its ways of understanding, identifying and combating corruption, given that
China is a socialist country with a long history of bureaucratic culture (Gong, 1994). The
CCP has put many constrains on the bureaucracy since its foundation due to the party’s
egalitarian idea among the society. But, on the other hand, the party continued to rely
heavily on the bureaucracy to manage the centrally planned and hierarchically ordered
economy. As a result, administrative power and its associated privileges essentially
turned the bureaucracy into a powerful social class (Gong, 1994).
Many of the oldest and draconian laws against corruption are found in China in
various forms, and over the long and rich tapestry of Chinese cultural development,
there are instances where harsh and sometimes effective actions have been taken
against individuals and even the system. However, throughout the history, those
measures failed more often than succeeded in those ghts, and in fact, no dynasty has
ever escaped the cycle of rise and fall that was linked to the phenomenon of corruption
(Ye, 2002). An ancient Chinese idiom “yi shi wei jian”[1] describes that we should always
take history as a mirror. Indeed, China has a very long history of ghting corruption,
and it is of signicant importance for us to look into the past before we move on to
discuss various initiatives against economic crime that are being taken in modern China,
given the political, social and culture issues that this topic raises. Accordingly in this
paper, the author proposes to examine the legal history of corruption control in China, in
which the discussion covers from its ancient times up until 1978 – which is the year
China launched its “open-door” policy.
Corruption control in ancient China
Chinese slavery societies (2070-476 BC)
A famous economist once mentioned: “the entire Chinese history was a history of
embezzlement” (Wang, 1987). Despite an exaggeration of the fact, it does suggest that
corruption has been a serious issue throughout Chinese history. Indeed, the history of
China’s legal system is of long standing and well established, and the content of its
legislative culture is fertile and colourful. Anti-corruption laws formed an important
part of ancient Chinese legal system, and the systematization, legalization and
institutionalization of the punishment of corruption-related crimes appeared as early as
in the slavery society of China (Rider et al., 2010). During the times of slavery societies of
Xia, Shang and Zhou Dynasties, there were already some written records of laws and
regulations to punish ofcials committing offences of bribery and corruption[2]. Over
2000 years ago, during the Yao Shun Yu period, when the judiciary enacted rules for the
emperor, there were provisions on punishing corrupt ofcials, given the name of “Ink
Penalty”[3], meaning if the ofcial was found guilty of corruption, he or she shall be
5
Economic
crime in China
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