One of the key reasons for such confusion, I guess, is the pace of change that has taken place in the past twenty years. When I was growing up in shanghai, I was told that china was lead by a ruling party called the communists, who claimed themselves to represent the best interests of the working class, and who defined china as a socialist country. Yet after 1989, china opened up at an increasing pace and in many aspects showed more capitalistic color than any European country. Naturally the question is raised: so what is china really?
Maybe this is too big a question for me, and probably there is never a correct answer. But I find it helpful to try the following definition: china is at an infant stage of a capitalist society. The animal spirit has been unleashed, and the rule of fittest to survive has been widely accepted. Today’s china arguably resembles the period of industrial revolution of the great Britain: productivity is being largely improved accompanied by urbanization, while the benefit of growth is extremely unevenly distributed among the winners and the losers. Also due to the extremely fast pace of change, the development and implementation of social rules is too slow to catch up with the change.
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