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China in a new period of transition

Author

Listed:
  • Veasna Kong

    (Treasury, Government of Australia)

  • Adam McKissack

    (Treasury, Government of Australia)

  • Dong Zhang

    (Treasury, Government of Australia)

Abstract

China’s economic transformation since 1978 has been remarkable. At the commencement of the reform period, China’s per capita GDP was lower than India’s, Pakistan’s, Indonesia’s, and Thailand’s, and about 3 per cent of that of the US. Today, it is multiples above Indian, Pakistani and Indonesian levels, and equivalent to 20 per cent of that of the US. Through a process of reform and opening up, the utilisation of a vast endowment of labour, the rapid accumulation of capital and technological catch up, China has been transformed from a rural agrarian economy to an urban industrial force. However, the structural transformations associated with industrialisation are giving rise to economic challenges and pressure for policy change. Following over three decades of rapid growth, China has reached a period where a heavy reliance on investment and exports has led to the build up of a number of economic, social, and environmental challenges that need to be addressed. While there remains potential for further impressive growth, the favourable conditions that China has benefited from in the past are, in many respects, reaching their ‘use by date’. This presents a range of policy challenges for China’s incoming leadership.

Suggested Citation

  • Veasna Kong & Adam McKissack & Dong Zhang, 2012. "China in a new period of transition," Economic Roundup, The Treasury, Australian Government, issue 4, pages 42-62, December.
  • Handle: RePEc:tsy:journl:journl_tsy_er_2012_4_2
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    References listed on IDEAS

    as
    1. Johansson, Anders C., 2012. "Financial Repression and China’s Economic Imbalances," Working Paper Series 2012-22, China Economic Research Center, Stockholm School of Economics.
    2. Justin Yifu Lin, 2013. "Demystifying the Chinese Economy," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 46(3), pages 259-268, September.
    3. Carmen M. Reinhart & M. Belen Sbrancia1, 2015. "The liquidation of government debt," Economic Policy, CEPR;CES;MSH, pages 291-333.
    4. Wang, Yan & Yao, Yudong, 2003. "Sources of China's economic growth 1952-1999: incorporating human capital accumulation," China Economic Review, Elsevier, vol. 14(1), pages 32-52.
    5. Jin Liu & Tony McDonald, 2010. "China: growth, urbanisation and mineral resource demand," Economic Roundup, The Treasury, Australian Government, pages 57-71.
    6. Leon Berkelmans & Hao Wang, 2012. "Chinese Urban Residential Construction," RBA Bulletin, Reserve Bank of Australia, pages 21-26, September.
    7. Paul Hubbard & Samuel Hurley & Dhruv Sharma, 2012. "The familiar pattern of Chinese consumption growth," Economic Roundup, The Treasury, Australian Government, pages 63-78.
    8. Brendan Coates & Dougal Horton & Lachlan McNamee, 2012. "China: prospects for export-driven growth," Economic Roundup, The Treasury, Australian Government, pages 79-102.
    9. Barry Bosworth & Susan M. Collins, 2008. "Accounting for Growth: Comparing China and India," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 45-66, Winter.
    10. David E. Bloom & David Canning & Jaypee Sevilla, 2001. "Economic Growth and the Demographic Transition," NBER Working Papers 8685, National Bureau of Economic Research, Inc.
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    Citations

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    Cited by:

    1. Brendan Coates & Dougal Horton & Lachlan McNamee, 2012. "China: prospects for export-driven growth," Economic Roundup, The Treasury, Australian Government, pages 79-102.
    2. Paul Hubbard & Samuel Hurley & Dhruv Sharma, 2012. "The familiar pattern of Chinese consumption growth," Economic Roundup, The Treasury, Australian Government, pages 63-78.
    3. Wilson Au-Yeung & Alison Keys & Paul Fischer, 2012. "Australia-China: Not just 40 years," Economic Roundup, The Treasury, Australian Government, issue 4, pages 7-41, December.

    More about this item

    Keywords

    growth model; economic system; economic development;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General

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