On The Economic Globalization, The Economic Functions Of The Chinese Government Into Strategic Choice

China is becoming a key player of the world through its emerging economy and increasing power. Although China has been complying with its WTO commitments since its entry to the WTO three years ago, China still faces challenges with regard to market economy transition. This is also the key for national competitiveness. Therefore, the top priority for the Chinese government now is to position itself properly in building a market economy.This thesis explores the opportunities and challenges that Chinese government faces on re-positioning its economic function and responsibilities. This paper examines different models of economic functions that government plays in the world and analysis Chinese government's options and opportunities.This thesis includes six parts:Part Ⅰ introduces issues and background related to government roles with defining the meaning of economic function of a government, and points out that the importance for such research for China.Part Ⅱ describes the historical transfer of government role with trace back to different stages of economic development. This part focuses on globalization: framing the impacts it brings to a government, defining objectives a government should follow, and analyzing international comparison. As a result of analyzing the history evolution of both the government and related theories in western countries, the author considers that there are four main phases in the development history of government's economic function: "Nationalism economy phase", when the governments carried the economy polices on emphasizing merchandise; "Night watchman phase," when the governments took the freedom economic policy; "Fully interfere phase", when the governments stick on the policy of fully interfering economy; and after 70's in the 20th century, came up with the forth phase, when governments insisted associating themselves with economy—" combination policy". Comparison and in-depth analysis draw the conclusion that both marketing mechanism and government interference are very important but depends.Part Ⅲ focus on government management models of market economies, such asthe United States and Japan, then provides evidence and arguments for China on how to position government's role in the future.Part IV reviews the history of functions and responsibilities of the Chinese government with regard to economic development, presents necessity of transferring the Chinese government economic function by analyzing the current challenges of Chinese government's economic function.Part V examines limited government theory and efficient government theory, and concludes by applying appropriate models for the Chinese government on positioning its economic functions. The author argues that Chinese government economic function should be the proper combination of limited and effective government, and the measures of transferring government macro-coordination and micro-coordination should be considered.Part VI addressed the conclusion that the Chinese government should take step to further enhance its economic functions focusing on both market and efficiency.