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Nee's (1989 and in this issue)" market transition theory," contested by Xie and Hannum (in this issue), claims that market mechanisms have predictable implications for inequality." Compared to nonmarket allocation, market exchange enhances the bargaining power of producers"(Nee, p. 910). The core argument is that cadre advantages shall decline to the extent that markets replace redistribution as the dominant mode of economic allocation. While in successive publications Nee has altered his judgment about how far the market transition has proceeded in rural China, and whether his theory does predict a decline of cadre privilege, he has not altered the core claim about market allocation. Market economies vary widely in their patterns of power and privilege, in ways unrelated to the extent to which a market economy has been established. The variability of market economies warns against attempts to predict …