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Socialism or capitalism? Tertium Datur

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  • Grzegorz W. Kolodko

Abstract

Two centuries ago, Asia delivered over 60 percent of world production; in the middle of the 20th century it was less than 20 percent. Currently, it is twice as large and this share is still increasing, above all but not only, because of China whose production is still growing at a rate twice as fast as the world average. China is trying to maintain high economic dynamics, inter alia, through investment external expansion. This aim is to be served, among others, by the infrastructure project, drawn up with enormous verve, known as the New Silk Road, which the Middle Kingdom addresses to 65 countries on three continents. While some hope for accelerating their own economic growth, others warn against the risk of becoming dependent on China. The article analyzes these challenges, pointing to the desired directions of irreversible evolution globalization by giving it a more inclusive character, which is also strongly emphasized by the Chinese authorities in their official enunciations. Is China still building socialism or has it already built capitalism? Or maybe both? And maybe none of those two systems as, with the market reforms that deviate from the traditional socialism, it has created something different from the classical types of political and socio-economic regimes known from the 20th century? Some authors have proclaimed that there's been capitalism in China for some time, others claim that socialism has developed there, of course one with a Chinese characteristic. Shortages have been successfully eliminated, but the economic system is unbalanced, showing surpluses this time. So is it socialism, as the official Chinese authorities claim, or capitalism, as asserted by other economists? Tertium non datur? Not at all, as there are yet other possibilities of regime interpretations, and the most fascinating one is being offered by the present-day China, where a unique internal convergence has taken place during the last generation. Elements of socialism intermingle with elements of capitalism and vice versa, creating a new, different quality. Tertium datur.

Suggested Citation

  • Grzegorz W. Kolodko, 2018. "Socialism or capitalism? Tertium Datur," Economy and Forecasting, Valeriy Heyets, issue 1, pages 7-36.
    • Handle: RePEc:eip:journl:y:2018:i:1:p:7-36
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