China. Socioeconomic Transitions in Connection with her Recent Economic Development

Abstract

This article seeks to highlight certain socioeconomic transitions that have accompanied and helped bolster the last three decades of economic growth experienced in the People’s Republic of China. The paper reflects on a period when China made the transition from a socialist economy to a market economy, and from a primarily agricultural and rural society to an increasingly, urban, industrial and service oriented one. This multiple transition process has benefited from a clearly one-off “demographic dividend”, in so far as the labour force has seen the inflow of the generations born in the 1960’s through to 1980’s, which if properly harnessed will result in China's ability to maintain the current high levels of internal saving and investment. The key argument proposed in this paper is that many of these critical comparative advantages enjoyed by China during the last 30 years of development have been, to an extent, one-off factors with a finite duration. Moreover, the rate and nature of the economic development has meant that certain social costs and problems have developed which now require new solutions. It is for this reason that the current Chinese leadership has started to modify the nature of the economic development strategy in China, introducing what they refer to as “scientific, harmonious, balanced and environmentally sustainable development”. The unknown factor around all of the above is whether the existing political establishment and system will be flexible and capable of realising these objectives.