Pei Responds

Issue: Mar-Apr 2009

DEBATING TOP-NOTCH economists, especially a highly respected and knowledgeable one like Jonathan Anderson, apparently borders on intellectual masochism for a political scientist. But because most economists are handicapped by an intellectual tunnel-vision problem—they tend to use economic growth as the only mark of social progress and ignore the overall context in which economic development takes place—this contest is not only winnable, but also can be intellectually fulfilling.

Jonathan starts out by using what he calls “hard data” to argue two points. First, on the economic front, he points out that China’s economic growth for the past thirty years has been driven by productivity growth (hence, it is of high quality), and that its state-owned enterprises have become market oriented and more profitable, on average, than private-sector firms. Second, Jonathan sees the risk factors that could derail China’s growth as “moderate”; he believes that social tensions in China are driven primarily by economic factors that will be easily fixed with China’s continued growth (poor social services in cities and low income growth in the countryside); and, that the lack of democracy rather than being a real danger is instead “one of the best predictors of success” in Asia.

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