China's Great Economic Transformation
This landmark study provides an integrated analysis of China's unexpected economic boom of the past three decades. The authors combine deep China expertise with broad disciplinary knowledge to explain China's remarkable combination of high-speed growth and deeply flawed institutions. Their work exposes the mechanisms underpinning the origin and expansion of China's great boom. Penetrating studies track the rise of Chinese capabilities in manufacturing and in research and development. The authors probe both achievements and weaknesses across many sectors, including China's fiscal, legal, and financial institutions. The book shows how an intricate minuet combining China's political system with sectoral development, globalization, resource transfers across geographic and economic space, and partial system reform delivered an astonishing and unprecedented growth spurt. The volume chronicles many shortcomings, but concludes that China's economic expansion is likely to continue during the coming decades.
amendments adopted in 2004 breached the former taboo on the term “private” by stating that “citizens’ lawful private property is inviolable.” The long march toward official recognition of private business came to an end only in 2007 when, following five years of fierce debate, China’s legislature enacted a landmark Law on Property Rights which, for the first time, explicitly places privately held assets on an equal footing with state and collective property. China’s treatment of the state-owned
firm’s existing situation, giving that firm incentives to improve profitability from the current achieved level. Particularistic contracting spread to local government fiscal systems, as local governments contracted to turn over specific sums of budgetary revenues to the central government. By the late 1980s, millions of family farms, hundreds of thousands of state enterprises, hundreds of foreign trade corporations, and all thirty of China’s provinces had signed contracts with their bureaucratic
never crossed. Reforms never threatened the job security of urban workers nor did they subject public enterprises to a hard bankruptcy constraint. Rural residents were never allowed to migrate permanently to the city, although the barriers to population movement were lowered slightly. High tariff and nontariff barriers to imported goods were never dismantled. Finally, domestic private business was never given a clearly legitimate position in the economic model. Only very small private businesses
of major inputs, products, and financial flows. As in the USSR, the key plan objective was to raise domestic saving, particularly by extracting resources from the rural sector, and to channel these funds toward industrial growth. China’s system was not a carbon copy of the Soviet Union’s. Mao Zedong broke new ground by herding Chinese villagers into large-scale collectives known as people’s communes in 1958. In addition, management of Chinese industry was significantly less centralized than in
population aging is on the horizon. In the nottoo-distant future – in a matter of a few decades – China’s population will start to shrink, an unprecedented demographic turn in its history in the absence of massive wars, epidemics, and famines. In this process, China will also lose its position as the most populous country in the world. Demographic changes in China are monumental for reasons in addition to the shifts in traditional demographic parameters – mortality, fertility, population growth