The Chinese Economy

(3 Credit Hours) · Undergraduate

In 1600, China was the richest country in the world. In 1978, China’s economy accounted for just a trivial amount of world GDP. It was agricultural, backwards, and dirt-poor. Today, its economy is second only to the U.S. The major theme for the course is to develop an understanding of these transitions and prospects for the future. Since the 1950s, society and economy have operated under a central plan. Economic and social policies have allowed Chinese people to build the world’s second largest economy. The speed and the extent of this transition for a country of this size is an economic miracle and unprecedented in history. The economic impact on human welfare has been remarkable, raising millions out of extreme poverty. China’s economic system operates under the heavy hand of an authoritarian government, run by the Chinese Communist Party (CCP). Economic policy decisions often reflect political reasons. Implementation and focus vary by the CCP leadership. The heavy hand of the state in economic affairs sharply contrasts with the American system. Questions we will seek to answer include: (1) Why was China so poor in 1978? (2) How and why did the economy take off? (3) How does the China economic miracle fit within accepted economic theory? (4) Is China’s economic development and growth sustainable?