Analysis of and Theoretical Reflections on China’s “Excessive De-Industrialization” Phenomenon

Houkai Wei () and Songji Wang
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Houkai Wei: Rural Development Institute, Chinese Academy of Social Sciences, No. 5 Jianguomennei Avenue, Dongcheng District, Beijing 100732, China
Songji Wang: Rural Development Institute, Chinese Academy of Social Sciences, No. 5 Jianguomennei Avenue, Dongcheng District, Beijing 100732, China

Chinese Journal of Urban and Environmental Studies (CJUES), 2019, vol. 07, issue 04, 1-31

Abstract: Industrialization is a long-term process of spiral transformation and upgrading. In a broad sense, industrialization can be divided into two stages, i.e. shallow industrialization and deep industrialization. The first stage refers to a process of expansive industrialization aiming to increase the proportion of industry, while the second stage refers to a process of contractive industrialization centered on improvements in industrial quality and competitiveness, to which the shallow industrialization is transformed and upgraded. In fact, the industrialization stages divided according to traditional theories, i.e. early stage, middle stage and late stage, are only for achieving the goals of shallow industrialization, instead of ultimately completing the developmental tasks of industrial economy. The transforming and upgrading from shallow industrialization to deep industrialization is an essential stage for a major country to enhance its development quality and competitiveness of industrial economy. So far, China has not fully industrialized. In the context of unbalanced and inadequate industrial development, China has seen a rapid decline in the industrial value-added and employment proportions in recent years, prematurely showing the features of rapid excessive de-industrialization in all respects. China’s current excessive de-industrialization is not only attributed to the impulse of rushing into mass actions in industrial upgrading, but also resulting from the combined effects of multiple factors such as surging factor prices and overcapacity at the current stage, exerting serious negative impacts on China’s economic growth, productivity improvement, development of modern service industry and transfer of agricultural labor force. In a long period of time ahead, considering the need to improve the quality of industrialization and the relationship between industry and services, real economy and virtual economy, the industry dominated by advanced manufacturing industry is still China’s major impetus for driving the medium–high rate of sustained and stable economic growth. Advancing deep industrialization remains a long and arduous task. Therefore, it is required to get rid of the misunderstanding caused by traditional theories and thinking, reconsider the importance of industrialization, implement the strategy of deep industrialization and prevent excessive de-industrialization. The specific measures include: expedite the promotion of deep industrialization in the developed regions of Eastern China, build a group of advanced manufacturing bases in Central and Western China and facilitate an in-depth integrated development of advanced manufacturing industry and modern service industry.

Keywords: De-industrialization; advanced manufacturing; modern service industry; deep industrialization; industrialization stages (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1142/S2345748119500179

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