H. D. Fong and the Study of Chinese Economic Development

H. D. Fong (Fang Hsien-ding, Fan Xianting, 1902–1985) was one of the most prolific writers dealing with China's economy during the 1930s and 1940s. During most of this period he was a member of the Nankai Institute of Economics, and his work contributed greatly to the institute's image as a premier research institution.¹ Much of Fong's writing is descriptive detail, useful now primarily to someone trying to survey Chinese economic conditions prior to 1949. However, his writings also display a search for analytical techniques and policy recommendations appropriate to improving the Chinese economy and particularly to promoting its growth and development. Fong was trying to become a development economist at a time when the field was not receiving much attention from economists in the West. A purpose of this essay is to examine the various approaches he attempted and the sources of inspiration and stimulation to which he responded.

During his teenage years, Fong became a protégé of wealthy cotton magnate H. Y. Moh and served a kind of apprenticeship in the Shanghai cotton industry from 1917 to 1921. Moh then provided financial support for Fong to begin undergraduate studies at New York University. When this support ended in 1923, Fong showed great ingenuity in becoming self-supporting through a variety of part-time jobs, including giving mah-jongg lessons in Gimbel's department store. In 1924 Fong was initiated into a fraternity of Chinese students, the Chen Chih-hui (CCH—Society for the Fulfillment of Life's Ambitions). This put him in contact with many people destined for prominence in Chinese public affairs. Fong's entry into the CCH was arranged by Franklin Ho (Ho Lien), who was then studying for a doctorate in economics at Yale. Ho became Fong's mentor, encouraging him to enter graduate study at Yale and then recruiting him for the Nankai economics program.

While at Yale, Fong held a student job in the library, which enabled him to buy surplus books very cheaply. He boasted that “when I returned to China in 1928 . . . I brought with me a library consisting of nearly 4,000 volumes of books and periodicals,” a collection which helped form the Nankai library (Fong 1975, 28). During the summer of 1925, Fong had the opportunity to work at the Ford Motor Company's River Rouge plant for three months. This and his earlier cotton-industry experience gave Fong a firsthand familiarity with industrial conditions that was probably unmatched among Chinese economists of his generation.

Fong's studies kept him in the United States for seven years. His autobiography tells us little about his studies at Yale. He was much influenced by the birth-control campaigns of Margaret Sanger and recognized that pressure of population growth was keeping Chinese people in poverty (Fong 1975, 25). His doctoral dissertation was directed by Professor Clive Day, who was putting together his book Economic Development in Modern Europe (1933). Fong's dissertation was published in China under the title The Triumph of Factory System in England (1930). In it, Fong described in detail the coexistence around 1840 of three forms of industrial organization—the factory system, merchant-employers, and craftsmen. There was little effort to provide a broad historical context, no significant economic analysis, no real discussion of public policy, and no references to China or to other contemporary low-income areas. However, the book demonstrated a humanitarian outlook that characterized his writings throughout his career.²

Fong returned to China at the end of 1928. The country was in a state of political and intellectual ferment. The Kuomintang (KMT), under the leadership of Chiang Kai-shek, had gained control of the national government in 1927. The KMT leadership claimed to be dedicated to the ideas of Sun Yat-sen (died 1925), which included an ambitious if rather ill-defined program for state-dominated industrial...