How Does State Entrepreneurialism Shape Green Transformation? Rural Industrial Restructuring in Gengche Town, China

This paper examines how local governments deploy entrepreneurial governance to shape green industrial transformation in rural China. Once a nationally known model of rural industrialisation built on waste plastic recycling, Gengche experienced severe environmental degradation before the local government began to accelerate a green transition that was already emerging. Drawing on semi-structured interviews, documentary analysis, and participant observation, this study finds that rural entrepreneurialism differs fundamentally from its urban counterpart in four ways. First, under collective land ownership and fiscal constraints, rural governments rely on asset revitalisation, upward integration, and downward empowerment rather than land finance. Second, the central state acts as a “meta-entrepreneur”, creating policy windows and designating successful local experiments as national models to incentivise emulation and diffuse best practices. Third, a rural growth coalition comprising elites and ordinary villagers, grounded in dense social networks and low entry barriers to new industries, enables conditional and uneven participation in new industries after the compulsory closure of polluting activities. Fourth, spatial governance follows an asset-light yet coordination-heavy logic, using small-scale specialised parks and place branding instead of large-scale land redevelopment. These findings extend the theory of local entrepreneurialism to rural settings and offer practical implications for China’s Rural Revitalisation Strategy and for other developing countries seeking to align rural industrial development with environmental protection.