The Oxford Companion to the Economics of China ed. by Shenggen Fan et al. (review)

This is a miniencyclopedia on contemporary Chinese economy: its key factors, key players, key institutions, main mechanisms, and distinctive growth patterns and trajectories.

This book is, without a doubt, a huge undertaking, containing a total of 98 short articles under 15 sections written by a total of 121 contributors, of whom two-thirds are ethnically Chinese. It would have been impossible in 1978, when China just abandoned the Maoist fundamentalism and opened its door to the outside world, to round up so many qualified Chinese to write about China’s growth and modernity the western way. At that time the Chinese economy was structurally premodern (i.e., predominantly rural) and autarkical (with less external trade than Hong Kong or Taiwan); very few Chinese mainlanders commanded the English language. The lineup of the authors does give the reader the impression that Chinese scholars are catching up quickly in social sciences of the West, which was unthinkable three decades ago.

This volume aims to inform readers of China with a wide range instead of a great depth, a necessary tryout perhaps. On the average, each short article is 5.6 pages long. The use of references and citations is kept minimal. Hence, articles reflect authors’ briefings, or assessments and judgements, rather than their original research outputs. In this context, this volume suits the general public instead of specialists.

Several characteristics of this volume will catch the reader’s attention. First of all, economic transition, a topic that dominated studies of post-Mao China until a decade ago, has marginalized: only four articles (2, 10, 33, and 74) are devoted to it. So, there seems a consensus among the authors that China has overcome its transitional phase and that the reforms have passed the point of no return.

Secondly, the role of the state remained a repertoire topic regarding, for example, choices of growth strategies and policies, and ways to govern the market/economy (13 articles). This certainly reflects China’s reality since 1949.

Thirdly, related to the role of the state, there is an acute awareness of socioeconomic and gender inequality and relative poverty in society (10 articles). This discussion of inequality and poverty is a new phenomenon given that the ruling party openly commits to communism and the welfare of one and every citizen in society. Inequality and poverty used to be treated as the state secret.

Fourthly, there is a strong concern about China’s external impact on the world (10 articles). This is new considering that Maoist autarky existed only a few decades ago. Finally, and rather unexpectedly, there are more articles on China’s regional growth and development than any other topic (16 articles). This obviously is an issue for both current and future generations.

Generally speaking, this volume is descriptive. Analysis is, at best, tacit. The amount of information on each particular topic is good only for those who want to have a rough idea about China. Specialists will find them inadequate due to the word limit that each article had to comply with.

The real issue is, however, the possible shelf life of this volume. China has been changing very fast—for good or bad. Clearly, the golden age of China’s explosive economic growth and development is now over. That type of growth occurred between 1980, when Deng Xiaoping’s reforms gained momentum, and late 2008, when the world financial sector experienced its meltdown. After 2009, the Chinese growth model has been facing very tough challenges. Firstly, the Maoist legacy of super-cheap labor has been a thing of the past. China’s labor market is no longer the most competitive one in the world. Factories have begun to move out of China to other regions where labor is cheaper.

Secondly, China’s high dependence on exports at the expense of its domestic consumption has backfired. Overseas orders...