Communism In China

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Over the past three decades, China has been undergoing economic reforms and changes to its political structure from communism towards a more market-oriented system. It’s changing political structure has been described in various terms such as pro-growth authoritarianism (Lai, 2010), a variegated form of state-permeated capitalism (Brink, 2013), refurbished state capitalism (McNally, 2013), and a social-capitalist model (Degen, 2011). All these terms suggest that China has been shifting towards a more market-oriented system but continue to take a state-centric approach. Deng Xiaoping described this system as a Socialist market economy with Chinese characteristics. This hybrid social-capitalist or social-communist model (Sigley, 2006; Wu, 2005) is unlike traditional communism whereby all economic and social activities are controlled by a centralized state dominated by a single political party. It is also a unique capitalist model that has yet to be fully developed.
Several studies have revealed that China’s complicated political structure will be able to continue experiencing high economic growth (Degen, 2011; Malkiel, et al., 2008) while others mention how it is obstructing China’s potential future economic growth (Brink, 2013; Group, 2011; Heytens & Zebregs, 2003; Kroeber, 2009). They contradict that while China has enjoyed high economic growth so far, its political structure has also prevented further growth as it restricts private firms’ interaction with the national economy. Empirical data analyses reveal that China’s hybrid social-capitalist system has been highly successful, evident from its continuously high GDP growth (Chen, Quan, & Liu, 2013), despite the contrasting qualities of the socialist and capitalist model. However...

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...omic model.
The multi-level governance has also created complications for economic growth even if the CCP wants to shift towards a market-oriented system. The structural interdependency between party-states and private, semi-private and state entrepreneurs coupled with their conflicting interests prevents optimal economic growth but also creates a strong alliance which has been hindering the control of the CCP. This need for the CCP to control China’s political system in turn has led to over-investment through the central government’s investment-driven growth, which would not occur had they not tampered with the natural dynamics of the market system.
Thus, China’s political may be economically beneficial in the short run, but may not be in the long run. Further research can be done on the possible ways for China to smoothly transition into a market-oriented system.
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