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China's Integration With The World: Development As A Process Of Learning And Industrial Upgrading

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Chapter Summary

In the past thirty years, China has achieved unprecedented economic growth and the most rapid poverty reduction in human history. This chapter reviews and synthesizes Chinas reform and trade integration with world economy, with a focus on Chinas unique approach to reform and opening since 1978. It argues that Chinas reforms follow the logic of a comparative advantage following strategy and the logic of development as a process of learning and innovation. The chapter first provides a historical review of Chinas development strategy before the economic reforms. It then reviews Chinas dual track approach to reform and opening, which followed the logic of learning to shift away from a comparative advantage-defying (CAD) strategy to a comparative advantage-following (CAF) strategy. It further analyzes some positive and negative lessons for developing countries, in particular those in Africa.

Keywords: China; comparative advantage defying (CAD) strategy; comparative advantage following (CAF) strategy; development strategy; economic reform; industrial upgrading; trade integration; world economy

10.1163/ej.9789004184213.i-354.45
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