Secret to Chinese Economic Growth

How did China Get Rich?

Cultural Revolution (1966-1976) = Epic Fail.

-eg. Killing Birds – insects increased

Tiananmen ( 천안문 ): 1976

A bit of History

Forbidden City & Great Wall

Remember 1979! Socialist Market Econ-

omy Open up economy Foreign Investments Private Property with

some regulation Reform! Deng Xiao Ping- This guy is a legend!- Idea from President Park?

A bit of History

Socialism: an economic system characterised by social ownership of the means of production and co-operative management of the economy, and a political philosophy advocating such a system.

Market economy is an economy in which decisions regarding investment, production and distribution are based on supply and demand and the prices of goods and services are determined in a free price system.

“Socialism also has markets and Capitalism also has planned economy” ( 사회주의에도 시장이 있으며 , 자본주의에도 계획이 있다 ) – Deng 1992

Eg. China vs Russia

What is Socialist Market Econ-omy

Remember Deng, 1979, Socialist Market Econ-omy

BIG, HUGE Corporations! Economies of Scale Support from Government Economic Growth = Political Legitimacy

Downside1. Moral Hazard2. Bureaucracy

Chinese Firms = Chinese Gov.

Problems of Chinese Economic Growth

Alright,, so what is the catch?

Really? Looks Like it..

Did China survive the Great Re-cession?

1. Corruption2. Sustainability3. Inequality4. Political stability > Macroeconomic Policy

Problems

홍색귀족 (Red Aristocrat): 혁명원로 자녀 신중국 건국 공신인 예젠잉 ( 葉劍英 ) 의 손녀 예밍쯔

( 葉明子 ): - “ 비행기는 2-3 명만 타고 다니는 줄 알았다 .” 이건희 둘째딸 이서현 : 100 만원 짜리 싸구려 옷

만들어 봤자 창피하게 누가 입겠냐 ..

1. Rich Chinese People ( 紅色貴族 )

Guanxi ( 關係 - 관계 ): Nepo-tism

Rise of Middle Class = Disaster for the envi-ronment.

Energy mostly by coal. Cars for 1.3 billion people?

2. China and Sustainability

Hukuo: migration within the country Passports to buy train ticket?

3. Inequality

Defying Gravity

4. Political Stability > Economic Policy