One day in August 2006, Mr. Cui Yingjie, a small-time street peddler, suddenly lunged toward a market regulator in the Beijing municipal government and knifed him to death. Mr. Cui had lacked a business license to operate his stall and the market regulator had confiscated his three-wheeled dolly – worth about US$50. This was the trigger to this tragic event.

Media reports of clashes between stall operators and market regulators are increasing in frequency. In one report, market regulators in Qingdao city were fitted with bullet-proof vests and helmets as protection against rebelling private merchants. On March 20, 2006, according to a Hong Kong newspaper, thousands of traders in Dongguan, a city in Guangdong province, clashed violently with the police. The protest was triggered when the market regulators beat and inflicted severe injuries on an unlicensed trader. The riot lasted for 12 hours and hundreds of police officers eventually prevailed by using tear gas to disperse the crowd. According to the Hong Kong newspaper, this was the third large-scale riot in the city of Dongguan in 2006 (and the article was published in March).

We have seen this type of violent clashes between government regulators and small traders before but not usually in an economy widely viewed as dynamic, rapidly growing, and liberalizing. The Stanford economist, John McMillan, in his book Reinventing the Bazaar: A Natural History of Markets (2002), describes how in 1979 the military government of Ghana resorted to violence and brutality to shut down the Makola marketplace in the city of Accra.