Social Sciences in China (Chinese Edition)

No. 1, 2025

Beyond the Project System: The Operational Logic and Institutional Foundation of Central Advocacy Policy Pilots

(Abstract)

Qiu Yi, Yu Jianxing and Ye Zhipeng

Since the 18th National Congress of the Communist Party of China (CPC), the central government has continuously refined the modern fiscal system and imposed stricter controls on special transfer payment projects, thereby constraining the project system centered on the vertical allocation of earmarked fiscal funds. In response to these constraints on direct budget allocation rights, central departments such as the Ministry of Commerce have actively explored an advocacy policy pilot model distinct from the traditional project system. This model addresses experimentation problems such as inadequate incentives for local pilot initiatives, information asymmetry between central and local governments, and insufficient innovation capacity by employing governance mechanisms including cross-level and cross-sector mobilization, full-process pilot oversight, and induced innovation support. These methods help to foster cross-level collaborative governance and ensure the fulfillment of pilot tasks. Advancing the advocacy system over the project system reflects the reshaping of the national governance models since the 18th CPC National Congress. Its success hinges on the central government’s ability to effectively mobilize local governments and market entities, achieving a synthesis of an “efficient market and effective government.” Looking ahead, the central advocacy policy pilot and the project system are likely to coexist in parallel and be used in combination, forming a new vertical intergovernmental division of labor that integrates “central advocacy + provincial and municipal project systems + primary-level governance.”