This study highlights the importance of the role of SOEs in the "dual-track pricing system" and its impact on other parts of the economy. Township and village enterprises were key to China's success in the late twentieth century, but have more or less disappeared as an entity over the past decade or so. By measuring the structural difference of the SOE sector before and after 1998-2003 SOE reform, Jin explains their fast catch-up in productivity since the mid-1990s, as well as