Sub-optimal Institutions but Superior Growth: The Puzzle of China's Economic Boom


Whyte, Martin K. 2014.“Sub-optimal Institutions but Superior Growth: The Puzzle of China's Economic Boom”. in China's Economic Dynamics: A Beijing Consensus in the Making?, edited by J Li and LM Wang. London: Routledge.


This paper focuses on inequality trends in contemporary China and their implications for the motivations and productivity of ordinary Chinese citizens. Based upon this analysis, it is my contention that, at least regarding patterns of inequality and opportunity, China’s experience does not require us to abandon conventional formulas in favor of a new set of prescriptions for growth, whether a Beijing Consensus or otherwise. Instead we need to consider Chinese institutional arrangements today against the backdrop of the arrangements that prevailed in
the last stages of China’s socialist planned economy. Viewed in this light, property rights and opportunity structures in China today might be viewed as sub-optimal  rather than bad, but at the same time as vastly improved compared to the very poor institutions of the late-Mao era. I will draw on evidence from China national surveys colleagues and I carried out in 2004 and 2009, focusing on popular attitudes toward inequality in China and comparisons with other societies, to reinforce my claim that current opportunity structures in China are compatible with the kinds of high citizen motivations needed for economic development.

Last updated on 06/19/2014