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After three decades of change in China, the central government's attempts to establish a harmonious society are being challenged by popular protests and social unrest. These challenges have been attributed to improper or ineffective local governance. This book examines government reform and governance in China's local state, with particular focus on the reasons why local government in its current form is not producing effective governance.The book provides a new conceptual framework relating to local governance in China, and analyses both the direct and indirect roles of formal institutions of local government, and the roles of informal networks and local communities. It examines the current governance institutions at county, township and village levels, as well as social capital development in local governance. The book goes on to propose that a fundamental restructuring of local government would enhance the capacity of local government, the local state-society interaction, and the quality of life for local residents. By tackling political debates on democratic reform at the local level as well as institutional building of local governance, this book allows readers to understand the major issues and possible solutions facing local governance in today's China.