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Paradoxes of Prosperity in China’s New Capitalism

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  • Tobias ten Brink

Abstract

This article gives a broad characterization of China’s political economy, as well as specific aspects of its socio-economic instabilities. With a focus on China’s export-oriented industry sectors, concepts from comparative and international political economy are applied to show how the Chinese economy can be understood as a variegated form of state-permeated capitalism that at the same time is deeply integrated into world economic processes. The article goes on to portray the socio-economic dynamics, as well as the instabilities of China’s new capitalism, that are at the root of the state leadership’s attempts to turn away from a one-sided model of export and investment-driven growth. Thereby, a number of obstacles are revealed for the “rebalancing” of the economy: a continued dependence on exports, a lack of domestic consumer demand which impedes a significant “social” upgrading, the ongoing low-wage model for which there is no end in sight, the limits of the state’s steering capacity and the weaknesses of its fragmented, competition-driven structure.

Suggested Citation

  • Tobias ten Brink, 2013. "Paradoxes of Prosperity in China’s New Capitalism," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 42(4), pages 17-44.
    • Handle: RePEc:gig:chaktu:v:42:y:2013:i:4:p:17-44
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    File URL: http://journals.sub.uni-hamburg.de/giga/jcca/article/view/691/689
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    References listed on IDEAS

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    2. Christopher A. MCNALLY, 2013. "Refurbishing State Capitalism: A Policy Analysis of Efforts to Rebalance China’s Political Economy," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 42(4), pages 45-71.
    3. Boyer, Robert, 2005. "How and Why Capitalisms Differ," MPIfG Discussion Paper 05/4, Max Planck Institute for the Study of Societies.
    4. Robert Boyer, 2005. "How and why capitalisms differ," Post-Print hal-00812971, HAL.
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    8. Richard Herd & Vincent Koen & Anders Reutersward, 2010. "China's Labour Market in Transition: Job Creation, Migration and Regulation," OECD Economics Department Working Papers 749, OECD Publishing.
    9. Christopher A. MCNALLY & Boy LÜTHJE & Tobias ten BRINK, 2013. "Rebalancing China’s Emergent Capitalism: State Power, Economic Liberalization and Social Upgrading," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 42(4), pages 3-16.
    10. Julian GRUIN, 2013. "Asset or Liability? The Role of the Financial System in the Political Economy of China’s Rebalancing," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 42(4), pages 73-104.
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