China, global capitalism and the quest for legitimacy
The widely held view ascribes China’s remarkable economic growth in the 1990s to the communist regime’s gradualist reform policies and illiberal development strategy. This essay challenges that view. The author argues that economic growth became the most important source of legitimacy of the Chinese communist regime in the aftermath of the Global 1989. The Chinese regime adopted a radical efficiency-biased economic reform in the 1990s. Such radical reform regardless of social justice gave rise to rampant corruption and a huge income gap between the rich and poor. Meanwhile, misinterpreting the East Asian growth model, the Chinese regime, eager to drive the economy to grow faster, carried out an externally oriented development strategy that combined export promotion with import liberalization at the expense of autonomous national development. By the late 1990s, both the economic reform and industrial development were stuck in a quagmire, rendering the economic growth difficult to sustain. Its deep concern for legitimacy thus led the Chinese regime to accept harsh terms on economic liberalization in order to secure WTO membership, in the hope of increasing export and FDI on a larger scale to reverse the declining economic momentum.
Keywordsglobalization marketization reform WTO accession autonomous development regime legitimacy
- Amsden, A. (2004) The Rise of ‘The Rest’: Challenges to the West from Late-industrializing Economies. New York: Oxford University Press.Google Scholar
- Braham, L. (2002) Zhu Rongji & The Transformation of Modern China. Singapore: John Wiley.Google Scholar
- Chen, M. (2001) A comprehensive analysis on the effect of FDI on Chinese economy. Strategy and Management 3: 93–103.Google Scholar
- Chen, M. and Yue, J. (2002) Exchange for technology with market share? An analysis of China’s strategy in absorbing FDI. Modern China Studies 4: 93–100.Google Scholar
- Cheng, X. (1995) Decision and miscarriage: radical price reform in the Summer of 1988. In: C.L. Hamrin and S. Zhao (eds.) Decision-Making in Deng’s China: Perspectives from Insiders, 2nd ed. Armonk, NY: M.E. Sharpe, pp. 189–206.Google Scholar
- Cheng, X. (2000) Where the prosperity comes from? – An analysis of China’s economic situation and trends. Open Times 9: 25–46.Google Scholar
- Cheng, X. (2003) Reinterpreting China’s miracle: Dynamism and consequences of economic growth. Modern China Studies 1: 25–46.Google Scholar
- Cheng, X. (2016) Capitalism making and its political consequences in transition: A political economy analysis of China’s Communist Capitalism, chap. 2, In: G. Wu, and H. Lansdowne (eds.) China’s Transition from Communism – New Perspectives (China Policy Series). Oxon and New York: Routledge, pp. 10–34.Google Scholar
- Cheng, X. and He, Q. (2001) A near-collapsing small-scale peasant economy – Dialogue about China’s agriculture, peasants and rural development. Modern China Studies 3: 2–39.Google Scholar
- Chu, W. (2009) The Chinese model of industrial policy under catch-up consensus: The case of the automobile industry. China Economic Quarterly 18:501–532.Google Scholar
- Cox, M. (2012) Power shifts, economic change and the decline of the west? International Relations 26(4): 369–388.Google Scholar
- He, Q. (1998) The Pitfalls of Modernization. Beijing: jinri zhongguo chubanshe.Google Scholar
- He, Q. (2011) A Volcanic Stability, http://hqlenglish.blogspot.com/2011/06/volcanic-stability.html.
- Lardy, N. (2002) Integrating China into the Global Economy. Washington: Brookings Institution Press.Google Scholar
- Li, L. (2008) Breaking the Siege - Days when the Door Started to Open. Beijing: zhongyang wenxian chubanshe.Google Scholar
- Lin, C (2008) China: Changing the rules of the game. Soundings 39(1): 7–19Google Scholar
- Nolan, P. (2002) China and the global business revolution. Cambridge Journal of Economics 26: 119–137.Google Scholar
- Olson, M. (1982) The Rise and Decline of Nations: Economic growth, Stagflation, and Social Rigidities. New Haven: Yale University Press.Google Scholar
- Quah, D. (2011) The global economy’s shifting centre of gravity. Global Policy 2(1): 3–9.Google Scholar
- Rodrik, D (2001) ‘Development Strategies for the Next Century’ [online]. Available from: http://www.eclac.cl/prensa/noticias/comunicados/6/7616/DaniRodrik29-08.pdf.
- Sun, L. (2004) Transition and Fracture: Structural Changes of the Chinese Society in the Reform Era. Beijing: Tsinghua University Press.Google Scholar
- Wade, R. (2004) Governing the Market: Economic Theory and the Role of Government in East Asian Industrialization. New Jersey: Princeton.Google Scholar
- Wu, G. (2008) Journey of Peace to Japan: Deng Xiaoping Made up His Mind to Launch Reform and Opening. Beijing: dangshi zongheng, No. 8.Google Scholar
- Yao, Y. (2010) The end of the Beijing consensus – Can China’s model of authoritarian growth survive? Foreign Affairs, 2 February, 2010, http://www.foreignaffairs.com/articles/65947/the-end-of-the-beijing-consensus.
- Yue, J. (2001) Foreign direct investment and China’s economic growth – roots of China’s integration into the global economy. Strategy and Management Issue 4: 70–77.Google Scholar
- Yue, J. (2004) The dim prospect of China’s industrialization. Dushu 7: 140–144.Google Scholar
- Yue, J. (2011a) The myth of the Chinese model. Leaders 3: 11–27.Google Scholar
- Yue, J. (2011b) Dilemma of national development in globalization – The politics behind China’s accession to the WTO. Unpublished PhD thesis, Department of Government, London School of Economics, pp. 134–139.Google Scholar
- Yusuf, S. et al. (2007) Under New Ownership: Privatizing China’s State-owned Enterprises. Stanford: The World Bank and Stanford University Press.Google Scholar
- Zhang, W. (1997) Corruption: The Second Best if not the First Best. In: China’s Economic Debate. Beijing: jingji guanli chubanshe.Google Scholar