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Chinese “New Norma” and Some of its External Outcomes


  • Sarmiza Pencea


While the “old normal” of Chinese economic success is no longer feasible, a “new normal” is taking shape in Chinese economic rhetoric, policies and realities. To better understand its meaning and outcomes, we first delineate what the “old normal” was, and then we try to briefly define the “new normal” against this background. The main focus of the paper is on the external implications of China’s shift of emphasis from investment to consumption, from factor-driven, to innovation-led growth, and from foreign to domestic demand, which from a global perspective is, in fact, a fundamental departure from the present global model of China being the “world factory”. We capitalize on the most recent information in the field, as well as on the accumulated knowledge on the subject from the scientific investigations carried out by other researchers, both Westerners and Chinese, trying to push further our own previous research findings.

Suggested Citation

  • Sarmiza Pencea, 2015. "Chinese “New Norma” and Some of its External Outcomes," Knowledge Horizons - Economics, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 7(2), pages 31-37, June.
  • Handle: RePEc:khe:journl:v:7:y:2015:i:2:p:31-37

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    References listed on IDEAS

    1. World Bank & the People’s Republic of China Development Research Center of the State Council, 2013. "China 2030 : Building a Modern, Harmonious, and Creative Society," World Bank Publications - Books, The World Bank Group, number 12925, December.
    2. Guonan Ma & Robert McCauley & Lillie Lam, 2013. "The Roles of Saving, Investment and the Renminbi in Rebalancing the Chinese Economy," Review of International Economics, Wiley Blackwell, vol. 21(1), pages 72-84, February.
    3. Mr. Ashvin Ahuja & Mr. Malhar S Nabar, 2012. "Investment-Led Growth in China: Global Spillovers," IMF Working Papers 2012/267, International Monetary Fund.
    4. Thomas I. Palley, 2005. "External Contradictions of the Chinese Development Model: Export-led Growth and the Dangers of Global Economic Contraction," Working Papers wp101, Political Economy Research Institute, University of Massachusetts at Amherst.
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    More about this item


    China; economic rebalancing; economic reforms; new normal; development model; world factory; external outcomes;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East


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