Our paper draws extensively on the growing empirical literature on the political incentives of government officials both in the Chinese context and in general. In a study of the comparative advantage of M-form vs. U-form, Maskin et al. (2000) find that the political status of a Chinese province (measured by the number of Central Committee members) is correlated with the provincial economic ranking. However, they do not establish a direct link between the career mobility of provincial leaders and their economic performance.2 In a different political setting, Besley and Case (1996) show that the economic performance of a state relative to neighboring states has a positive impact on the re-election prospects of US governors.3