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The Chinese are worried that their economy is "sinking down"

Politiko 2024-12-08 15:11:31

The Chinese are worried that their economy is "sinking down"

While the government is trying to boost economic growth, many Chinese are pessimistic about the future of the country's economy, writes The Economist.

These have been tough times for the Chinese stock market. After the government began ramping up measures in late September to boost the stagnant economy, stock prices rose and fell again slightly as investors awaited details about the government's measures.

Lawmakers unveiled even more stimulus measures on November 8.

But public anxiety about the long-term prospects of the Chinese economy is hard to assuage. And that was true even before the election of President Donald Trump, who has threatened to impose heavy tariffs on Chinese goods.

The debate on Chinese social media reflects many citizens' views on the future. As always, given China's heavy internet censorship, the talks are cautious, avoiding complaints that could anger the Communist Party.

Those countries with institutions that are "inclusive," that is, that work in the interests of diverse groups rather than a narrow elite, achieve more sustainable economic growth than institutions that are "exclusive," the book argues.

The authors say that China’s economic institutions have become more inclusive since the era of Mao Zedong. This has enabled China’s extraordinary economic expansion in recent decades. But they add that China’s political institutions remain exclusionary, increasing the likelihood that the economy “will lose momentum.”

It is remarkable that such an argument was allowed to circulate in China, especially under President Xi Jinping, who took power shortly after the book was published in English and quickly maneuvered to silence the voices of some liberals who would have been its natural fans.

The Chinese edition of the book omitted many of the authors’ arguments about China, especially parts that are vital to its political system. Mr. Acemoglu says he and his co-authors thought it was “worth trying to reach the Chinese public in this way,” even though it was a “very painful episode.”

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