The authors argue that government regulation of news is needed as China navigates unsettling social changes. But the present system of secretive and often arbitrary censorship is stoking corruption and public distrust of government, they said.
"Freedom of the press is an inevitable trend," they said, calling for a law to protect reporters and "effectively halt unconstitutional and unlawful interference in media activities".
They also urge greater official respect for religion - a sensitive topic in China, where the atheist Party is wary of growing numbers of Christians, and unrest in Buddhist Tibet and the largely Muslim region of Xinjiang in the country's far west.
"Political faith and religious faith are not in contradiction," the scholars said.
They propose that China's nearly 3,000-delegate national parliament be slimmed down and given direct powers to set the budget and audit government spending.
Candidates for legislatures should be allowed to actively compete for votes, which is now banned, the authors said. And the Communist Party itself must bind itself under rule of law.
Communist Party chief Hu has promoted limited "inner-Party democracy" to expose officials to more checks, but has shown no appetite for broad political liberalisation.
In a speech on Monday, Hu said the Party had to be a "staunch leadership core" that maintained "flesh-and-blood bonds" with the people, Xinhua news agency reported.
But the Party School report, with its detailed arguments for change, and other books and essays from reformist advisers in the past year, suggest that some senior advisers have been thinking closely about much more ambitious reforms.
A recent survey of mid-ranking officials studying at the Party School indicated that growing numbers believe deeper political reform is needed.
In the survey of 154 officials conducted in late 2007, 55.5 percent nominated the "political system" as one of three areas of reform that most "concerned" them, according to a study recently published by the Chinese Academy of Social Sciences.
In late 2005, 40 percent of officials surveyed listed political reform as one of the areas.
