China’s extraordinary growth over the past few decades has spawned two major lines of analysis. One school of thought holds that China is a rising economic power poised to conquer the world. The other argues that China’s economy has become so distorted that it is bound to collapse or, at least, as a former United States Treasury secretary suggested, “regress to the mean.”
Both views are mistaken.
For one thing, China has never been a normal economy. It experienced an average of nearly 10 percent growth rates for almost four decades, a record; it is the first developing nation to become a great power.… Seguir leyendo »
Xi Jinping and Li Keqiang are taking over China’s leadership at a time when growth has slackened and labor issues have become more complex.
Reports that businesses such as Foxconn Technology Group are raising wages and struggling to recruit workers in China have intensified debate over just how many surplus workers the country still has. Meanwhile, a boom in college-educated Chinese has raised concerns of an impending threat to U.S. competitiveness. These seemingly disparate concerns about China’s labor force are actually linked by common underlying factors, with critical implications for China’s ability to remain the growth engine of the world.
China’s large pool of surplus labor has fueled its rapid industrial growth.… Seguir leyendo »
China watchers are fixated on whether the new leader, Xi Jinping, will be a reformer in the mode of Deng Xiaoping, the man credited with opening China’s economy to the world three decades ago. Many hope that Xi will be as aggressive on political liberalization as Deng was on economic liberalization.
But this focus on personalities may be misplaced, given the collective nature of China’s decision-making. More attention needs to be given to whether China’s unique form of regional decentralization — which triggered a remarkable economic transformation but discouraged political liberalization — can continue unchanged.
With an expanding middle class becoming more aware of the country’s potential, there is mounting speculation that political reform will happen — it’s a question of when and how, not if.… Seguir leyendo »