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Chinas success owes more to its entrepreneurs than its bureaucrats. Time to bring them out ofthe shadows FEW would deny that China has been the economic superstar of recent years. Thanks to itsrelentless double-digit annual growth, it has become the worlds second-largest economy andin many ways the most dynamic. Less obvious is quite what the secret of this success hasbeen. It is often vaguely attributed to capitalism with Chinese characteristicstypically takento mean that bureaucrats with heavy, visible hands have worked much of the magic. That,naturally, is a view that Chinas government is happy to encourage. But is it true? Of course, the states activity has been vast and important. It has beeneffective in eradicating physical and technological obstacles: physical, through theconstruction of roads, power plants and bridges; technical, by facilitating the transfer of foreign intellectual property. Yet Chinas vigour owes much to whathas been happening from the bottom up as well as from the top down. Just as Germany has itsmighty Mittelstand, the backbone of its economy, so China has a multitude of vigorous, private entrepreneurs: a fast-growing thicket of bamboo capitalism. These entrepreneurs often operate outside not only the powerful state-controlled companies,but outside the countrys laws. As a result, their significance cannot be well tracked by the stategenerated statistics that serve as a flawed window into Chinas economy. But as our briefingshows, they are an astonishing force. | 
