Domestic savings-driven growth: unveiling internal economic dynamics in China, 1980-2010

Kent Deng and Jane Du

Economic History Working Papers from London School of Economics and Political Science, Department of Economic History

Abstract: It has been commonly believed that economic reforms in the post-Mao Era since 1980 have changed China from autarky to an export-oriented developmental path, accompanied by inward and cheap FDI with advanced foreign technology. This paper challenges this view with quantitative evidence and shows that China’s recent growth has depended heavily on a domestic source of capital coming from newly available household sayings, stemming from (1) state mandatory price control over food as a wage good on the one hand and (2) a fast-growing wage level due to arising labour productivity on the other.

Keywords: developmental state; gradualism; saving-led growth; price overshoot; wage goods; economic transition (search for similar items in EconPapers)
JEL-codes: O11 P21 P51 Q18 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2024-03-01
New Economics Papers: this item is included in nep-cna, nep-fdg, nep-his and nep-tra
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