buckle. Xiaobai pretended to cough blood and collapse, tricking Guan Zhong into thinking he was mortally wounded. Eventually, Xiaobai won the race back to Qi, and was installed as Duke. The State of Lu attempted to enforce Prince Jiu's claim, but was defeated in battle, after which Qi forced Lu to execute Prince Jiu and send Guan Zhong back as a prisoner. Xiaobai originally wanted to execute Guan Zhong as well, but Bao Shuya strongly recommended sparing him and elevating him to chancellor, even though that meant he would outrank Bao himself. Xiaobai was eventually convinced. Domestic reforms Duke Huan had inherited a state in turmoil, after three years of civil wars and usurpation had severely depleted the treasury. As Chancellor, Guan Zhong instituted extensive reforms aimed at organising and strengthening the Qi state. Administratively, the capital was divided into 21 districts: six of merchants, which provided the Qi state's trade revenue, and fifteen of attendants, which provided the core of the Qi army. Similarly, the population outside the capital was organised: 30 households were formed into one village, 10 villages as one troop, 10 troops as one district, 3 districts as one county, and counties grouped into five regions. Administrators were appointed at every level, with the regional administrators reporting on their jurisdictions to the Duke every year. Economically, Guan Zhong disbanded the well-field system instituted since the Zhou Dynasty; instead, all land was to be taxed according to its productivity. At the same time, Qi's coastal position was exploited through the expansion of fisheries and salt production, while trade was encouraged through certain privileges. For instance, people bearing goods to market on foot, and carriages arriving empty at markets to make purchases, were not subject to tolls; this encouraged the use of the state-managed markets. Guan Zhong further proposed that the "goods of the mountains and seas" (namely iron and salt) should be state managed, a policy that would evolve into state monopolies later in Chinese history. Similarly, a price-regulation scheme existed for food, with granaries buying grain in bounty years to be released into the market in lean years. Finally, coinage was also unified to encourage trade within Qi. Philosophy and appraisal Guan Zhong was disparagingly identified with the Legalist school as a result of his administrative reforms. Though actually legalistic philosophy did not develop until hundreds of years later, R. Eno of Indiana University does consider