Centralising state power, undermining local growth politics and escalating debt crisis: A new stage of state entrepreneurialism in China

Strengthened state interventions have reshaped China’s urban governance agendas to achieve both economic and extra-economic goals, challenging the conventional understanding of urban entrepreneurialism. However, little is known about local struggles when extra-economic agendas confront local fiscal insufficiency. We investigate the trajectory of urban development in Dali, a small city in the peripheral regions of China. We find an emerging form of urban governance in which the central state consolidates control over local development politics, compelling local governments to repurpose entrepreneurial tactics, such as land value capture and public–private partnerships, to implement central priorities, especially environmental protection. These practices have reconfigured the previous local growth politics, while exacerbating local government indebtedness. We conceptualise this phenomenon as a new stage of state entrepreneurialism, a hybrid governance approach that employs market tactics to achieve central strategic objectives, resulting in state power restructuring and urban governance transformation with substantial liabilities. Based on grounded practices, this article illuminates the limits of state interventions in post-growth urban governance experiments.