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Conversations on issues of development policy in Pakistan and the rest of South Asia. Political economy subjects that are seldom featured in the media will be taken up.
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Monday Dec 21, 2020
Monday Dec 21, 2020
About Author
Dr. Khalid Malik, Founder and Co-chair (alongwith Prof. Jean Paul Fitoussi) of the Global Sustainability Forum based in Rome, Italy. He also serves as Special Advisor, International Development Law Organization.
He is a former Director of the UNDP Human Development Report Office from June 2011 till 31 August 2014. He has held a variety of senior management and substantive positions in the United Nations. He served as UN Resident Coordinator in China (2003–2010), Director, UNDP Evaluation Office (1997-2003) and Chair, UN Evaluation Group. Earlier he was UN Representative in Uzbekistan.
He has been active on UN reform and has worked closely with development partners and UN intergovernmental bodies. In 2009, Mr. Malik was one of ten “champions” - and the only foreigner - to be honored for their contributions to the protection of the environment in China.
Mr. Malik has lectured widely on global issues and development economics in the US, UK, Pakistan and China. He was the Simon Professional Fellow at Manchester University.
He has written widely on a range of topics.
His book "Why China Has Grown So Fast for So Long" was published in 2012 by Oxford University Press and translated into Chinese in 2019 by Renmin University Press.
Earlier, he co-edited “Capacity for Development: New Solutions to Old Problems” (2002), and Lessons Learned in Crisis and Post Conflict Situations (2002).
Before joining the UN, Mr. Malik conducted research at the Pakistan Institute of Development Economics (1975) and taught at Pembroke College, Oxford (1974-75). He studied economics and statistics at the universities of Oxford, Cambridge, Essex and Punjab.
Dr. Khalid Malik, Founder and Co-chair (alongwith Prof. Jean Paul Fitoussi) of the Global Sustainability Forum based in Rome, Italy. He also serves as Special Advisor, International Development Law Organization.
He is a former Director of the UNDP Human Development Report Office from June 2011 till 31 August 2014. He has held a variety of senior management and substantive positions in the United Nations. He served as UN Resident Coordinator in China (2003–2010), Director, UNDP Evaluation Office (1997-2003) and Chair, UN Evaluation Group. Earlier he was UN Representative in Uzbekistan.
He has been active on UN reform and has worked closely with development partners and UN intergovernmental bodies. In 2009, Mr. Malik was one of ten “champions” - and the only foreigner - to be honored for their contributions to the protection of the environment in China.
Mr. Malik has lectured widely on global issues and development economics in the US, UK, Pakistan and China. He was the Simon Professional Fellow at Manchester University.
He has written widely on a range of topics.
His book "Why China Has Grown So Fast for So Long" was published in 2012 by Oxford University Press and translated into Chinese in 2019 by Renmin University Press.
Earlier, he co-edited “Capacity for Development: New Solutions to Old Problems” (2002), and Lessons Learned in Crisis and Post Conflict Situations (2002).
Before joining the UN, Mr. Malik conducted research at the Pakistan Institute of Development Economics (1975) and taught at Pembroke College, Oxford (1974-75). He studied economics and statistics at the universities of Oxford, Cambridge, Essex and Punjab.
About Book:
The book sets out to explain the sustained economic growth of China in the past 30 years. The author argues that though the trend of growth based on official statistics looks unbelievable and has been questioned by researchers all along, the ways economic growth was examined were narrow and tended to lead to doomsday forecasts. The author intends to offer an alternative explanation: the Chinese success has been a result of multidimensional changes aiming for transformation.
Chapter 1 is an overview of China's economic performance in the last 30 years. This chapter offers basic information on output, poverty reduction and health indicators. It also describes the structural changes brought by the emergence of private‐sector businesses, growing productivity since the 1980s, growing importance of trade and changing population structure.
Chapter 2 produces a short account of China's reform history. The description, though brief, covers a lot of ground, offering a concise description of what China has gone through in both economic and social perspectives.
Chapter 3 reviews the studies on China's growth by summarizing the attempts in existing literature to explain and forecast the growth in China. These are researches done by economists based on neoclassical economic theories: factors of production, including factor accumulation and factor reallocation and total factor productivity (TFP). However, to unpack TFP, there needs to be new theories. There have been exploratory works in this direction, such as those on the role of clearly defined property rights and market liberalization. However, all the existing theories suggested that China would fail soon, at the time of the study, as it could not satisfy the conditions required for sustained growth.
Chapter 4 produces an analytical framework of transformation. The author argues that economic theories that focus on one or two dimensions of the production functions would inevitably lead to doomsday forecasts. However, the Chinese reform is not only in one dimension, it is a reform on many fronts, and each of them contributed to the success of long‐term growth in China. The transformation framework includes ownership, capacities and policies. It is in essence an attempt to shift away from the focus on economic growth. As pointed out by the author, development is not about narrowly defined output growth and productivity growth. It should be about comprehensive changes in various domains of the society. What China has been trying to achieve is transformation in many such domains.
Chapter 5 applies the transformation framework to China and argues that ownership, capacities and policies were the forces behind the 50‐fold growth in income per capita since the late 1970s. Under each category of forces, there are a number of propositions and then the experience of China has been discussed accordingly. There are all together 13 propositions. The author tries to argue that they all contribute to the transformation of China.
Chapter 6 is about the future prospects. In this chapter, the author makes forecasts and points out challenges for the future of China's transformation. These challenges include the environment suitability, the building up of societal capabilities, the reduction of disparities, the reinforcing of social cohesion, demographic changes and a range of macroeconomic policies.
The author takes on a daunting task in trying to make sense of the whole picture of China's reform. As he rightly points out, a tunnel view of China's economic performance has so far been unsuccessful in predicting its long‐lasting growth. China's reform needs to be understood multidimensionally. The book provides a large amount of information on policy changes in many sectors of the society.
The book would be a good read for students in development studies and China studies, in particular for those who have not been following the Chinese reforms closely. At the same time, for researchers in China, this book can also be a useful reference on policy areas that they may not be familiar with.
The book has several weaknesses.
First, the first chapter of the book presents China's growth story in relation to the rest of the world. The author compares China, India and ASEAN countries and argues that China consistently outperforms the rest of the world. However, it would be interesting to see how China has performed in the post‐war period in contrast to East Asian countries which started to grow earlier than China and also experienced a relatively long period of rapid growth.
This book does a good job of criticizing existing accounts of why China has grown so fast for so long. However, the author does not provide a convincing argument, let alone data, that his own explanation can do better. There is also a lack of coherence between the two parts of the book. The first part takes it for granted that it is important to understand why China's economic growth has been so impressive, but the second part argues that development is about transformation rather than growth, and that a focus on growth is misguided.
The application of transformation theory to China is largely based on the author's narrative, and there is not much empirical evidence showing the actual relationship between transformation and growth. Based on the last three chapters of this book, it would be more suitable to consider the theme of the book to be how transformation has taken place and how transformation matters in China, rather than on how transformation helps to explain growth, as there is little attempt to draw a causal link between the two.
Finally, the book is mostly written based on the data before the international economic crisis happened. Many of the projections the author used also come from pre‐crises periods, except for the reference to some general comments. The environment for growth now is quite different from the earlier period. China's economic growth is destined to slow down and the Chinese government's planning on making major changes in a number of policy areas. It would be interesting to see whether the transformation theory can provide a reliable forecast to the future.
Chapter 3 reviews the studies on China's growth by summarizing the attempts in existing literature to explain and forecast the growth in China. These are researches done by economists based on neoclassical economic theories: factors of production, including factor accumulation and factor reallocation and total factor productivity (TFP). However, to unpack TFP, there needs to be new theories. There have been exploratory works in this direction, such as those on the role of clearly defined property rights and market liberalization. However, all the existing theories suggested that China would fail soon, at the time of the study, as it could not satisfy the conditions required for sustained growth.
Chapter 4 produces an analytical framework of transformation. The author argues that economic theories that focus on one or two dimensions of the production functions would inevitably lead to doomsday forecasts. However, the Chinese reform is not only in one dimension, it is a reform on many fronts, and each of them contributed to the success of long‐term growth in China. The transformation framework includes ownership, capacities and policies. It is in essence an attempt to shift away from the focus on economic growth. As pointed out by the author, development is not about narrowly defined output growth and productivity growth. It should be about comprehensive changes in various domains of the society. What China has been trying to achieve is transformation in many such domains.
Chapter 5 applies the transformation framework to China and argues that ownership, capacities and policies were the forces behind the 50‐fold growth in income per capita since the late 1970s. Under each category of forces, there are a number of propositions and then the experience of China has been discussed accordingly. There are all together 13 propositions. The author tries to argue that they all contribute to the transformation of China.
Chapter 6 is about the future prospects. In this chapter, the author makes forecasts and points out challenges for the future of China's transformation. These challenges include the environment suitability, the building up of societal capabilities, the reduction of disparities, the reinforcing of social cohesion, demographic changes and a range of macroeconomic policies.
The author takes on a daunting task in trying to make sense of the whole picture of China's reform. As he rightly points out, a tunnel view of China's economic performance has so far been unsuccessful in predicting its long‐lasting growth. China's reform needs to be understood multidimensionally. The book provides a large amount of information on policy changes in many sectors of the society.
The book would be a good read for students in development studies and China studies, in particular for those who have not been following the Chinese reforms closely. At the same time, for researchers in China, this book can also be a useful reference on policy areas that they may not be familiar with.
The book has several weaknesses.
First, the first chapter of the book presents China's growth story in relation to the rest of the world. The author compares China, India and ASEAN countries and argues that China consistently outperforms the rest of the world. However, it would be interesting to see how China has performed in the post‐war period in contrast to East Asian countries which started to grow earlier than China and also experienced a relatively long period of rapid growth.
This book does a good job of criticizing existing accounts of why China has grown so fast for so long. However, the author does not provide a convincing argument, let alone data, that his own explanation can do better. There is also a lack of coherence between the two parts of the book. The first part takes it for granted that it is important to understand why China's economic growth has been so impressive, but the second part argues that development is about transformation rather than growth, and that a focus on growth is misguided.
The application of transformation theory to China is largely based on the author's narrative, and there is not much empirical evidence showing the actual relationship between transformation and growth. Based on the last three chapters of this book, it would be more suitable to consider the theme of the book to be how transformation has taken place and how transformation matters in China, rather than on how transformation helps to explain growth, as there is little attempt to draw a causal link between the two.
Finally, the book is mostly written based on the data before the international economic crisis happened. Many of the projections the author used also come from pre‐crises periods, except for the reference to some general comments. The environment for growth now is quite different from the earlier period. China's economic growth is destined to slow down and the Chinese government's planning on making major changes in a number of policy areas. It would be interesting to see whether the transformation theory can provide a reliable forecast to the future.
Discussant:
Saeed Afridi, International Relations, Security & Energy Scholar with a focus on Central Asia
Saeed Afridi, International Relations, Security & Energy Scholar with a focus on Central Asia
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