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China's Great Ascendancy and structural risks: consequences of asymmetric market liberalisation

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  • Yiping Huang

Abstract

China's great ascendancy from a poor agrarian economy to an economic superpower is unprecedented. But in the process, structural imbalances, resource inefficiency, and income inequality worsened rapidly. It is argued that the coexistence of China's extraordinary growth and serious structural risks are two sides of the same coin: asymmetric liberalisation of product and factor markets. Distortions in markets for labour, capital, land, energy, and the environment lower production costs, increase corporate profits, raise investment returns, improve the international competitiveness of Chinese goods, and therefore lift China's growth. But they also depress consumption. China needs to accelerate factor market liberalisation in order to complete the transition to a market economy and to lock the economy onto a more sustainable path. Copyright © 2010 The Author. Journal compilation © 2010 Crawford School of Economics and Government, The Australian National University and Blackwell Publishing Asia Pty Ltd..

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  • Yiping Huang, 2010. "China's Great Ascendancy and structural risks: consequences of asymmetric market liberalisation," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 24(1), pages 65-85, May.
    • Handle: RePEc:bla:apacel:v:24:y:2010:i:1:p:65-85
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    3. Ms. Nan Geng & Mr. Papa M N'Diaye, 2012. "Determinants of Corporate Investment in China: Evidence From Cross-Country Firm Level Data," IMF Working Papers 2012/080, International Monetary Fund.
    4. Stephen Howes & Paul Wyrwoll, . "New Challenges to the Export Oriented Growth Model," Chapters, in: Zhang Yunling & Fukunari Kimura & Sothea Oum (ed.), Moving Toward A New Development Model For East Asia-The Role of Domestic Policy and Regional Cooperation, chapter 3, pages 55-120, Economic Research Institute for ASEAN and East Asia (ERIA).
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    10. Michel Aglietta & Guo Bai, 2014. "China’s Roadmap to Harmonious Society : Third Plenum Decisions on “major issues concerning comprehensively deepening reforms”," CEPII Policy Brief 2014-03, CEPII research center.
    11. Stephen Howes & Paul Wyrwoll, 2012. "Climate Change Mitigation and Green Growth in Developing Asia," Working Papers id:5059, eSocialSciences.
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