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Socialism with Chinese characteristics

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Socialism with Chinese characteristics is the system applied by the Communist Party of China since Deng Xiaoping. It synthesizes state control with market forces to fulfill socialist Five-Year Plans to accelerate the productive forces and common prosperity.

Achievements

Poverty Reduction

From the beginning of Reform and Opening Up to 2022, poverty has been reduced significantly. The number of people living below the poverty line (1.90 USD a day) has fallen by around 800 million people. China has contributed to around 75% of the worlds total poverty reduction.[1] The rural poverty rate declined from 97.5% to 1.7%.[2] By 2020, absolute poverty was eliminated in China, being the first country to reach the UN goal of "No absolute poverty".[3] From 1981 to 2015, China's poverty rate declined from 88% to 0.7%.[4] When discussing relative poverty of 2.15 USD or below a day, from 1981 to 2019, 91.62% declined to 0.14%. And less than 3.65 USD a day, fell from 2.15 to 0.14%.[5] And in regards to discussing relative poverty of 6.85 USD or below a day, from 1981 to 2019, fell from 99.98% to 24.72%.[6]

China's Engels coefficient (% of income spent on food) was 57.5% for urban residents, 67.7% for rural residents in 1978. Which declinded to 29.3% in 2016 for urban residents and 32.2% for rural residents.[7] Total Engel's Coefficient fell to 29.8% in 2021.[8] China's domestic population share suffering under Global Multidimensional poverty fell from 9.47% in 2010 to 4.21% in 2014 and fell to 3.9% in 2023. Lack of clean drinking water, malnutrition and use of solid cooking fuel are the largest contributors.[9]

While global absolute poverty (measured as less than $1.25/day) declined from 40.5 to 25.2 per cent between 1981 and 2008 (a 15.3% reduction), China begin the period with a much higher rate (84.0 per cent) and succeeded in reducing it to 13.1 per cent (a 70.9% reduction). Moreover, China even substantially reduced relative poverty (defined as living below 50% of mean income) from 85.2 to 41.0 per cent while the developing world's poverty rrate scarcely changed (Less than 10 percent change over the same time period of which being 1981 to 2008). By 1996, China's relative poverty was already below the relative poverty rate of the developing world.[10]

Agriculture and Food Security

Grain production per capita finally exceeded the 1955 peak in 1978[11], while the total factor productivity in agriculture finally exceeded the 1958 peak in 1983.[12] After Deng Xiaoping implemented the household responsibility system, agricultural output increased by 8.2% a year, compared with 2.7% in the pre-reform period, despite a decrease in the area of land used. Food prices fell by by nearly 50%, while income rose.[13]

The real gross value of crop output per arable acre rose by around three quarters during the reform period. The average annual real grown of net farm output per worker accelerated sharply from only 0.3 per cent between 1957 to 1978 to 4.3 per cent from 1978 to 1991[14] During a two-year period in rural China, 1979-81, agricultural productivity increased by 18 per cent.[15]

From 2012 to 2022, food security in China ranked according to the Global Food Security index rose from 55 to 74.2.[16] China is ranked 25th out of 113 countries on overall score, placing it in the top 20 percent. China is ranked 2nd out of 113 countries on food availability, 33rd on food affordability (top 29%), 46th on food safety (top 40%) and 55th on sustainability and adaption (top 48%)

In 2022, China's prevalence of under nourishment is at 2.5% compared to the global average of 9.8%. 4.7% of children are stunted compared to the global average of 22%. China's rate of underweight children is 2.4% while the global average of 2021 is 12.6%. China's rate of obesity is 6.6% compared to the global average of 13%.

China has had a 100% positive change in food costs compared to the mean index of 78%. A 100% positive change in food safety net programmes compared to the mean of 72.4%. A score of 78.9 compared to the mean of 57.6 of access to agricultural input for farmers. A score of 98.6 for food volatility compared to the mean of 68.7. A score of 69.3 for supply chain infrastructure compared to the mean of 61.9. A score of 100 for commitment to input food security policies compared to the mean of 47. A protein quality of 83.8 compared to the mean of 68.5 and a food safety of 92.4 compared to the mean of 76.4.[17]

In 2012 the Food and Agriculture Organization found that China (-96 million) and Viet Nam (-24 million) amounts to 91 percent of the net numerical reduction in undernourished people since 1990-92. Scholars associate land reform with China’s advance against hunger (and SOFI12 acknowledges small farmer access to land in China as key); to understanding the progress of China and Viet Nam, experts cite egalitarian land reform as a key. In both countries, small holders secured access to land through state policies. SOFI12 also notes the “situation of relatively equal access to farmland and human capital” in China as important in China's striking progress against hunger.[18]

Labor productivity increased in the post-reform area, the annual growth rate of GVA per worker was only 0.8 per cent per year between 1955 and 1981, whereas it grew at a rate of nearly 5 per cent per year after 1981.[19] From 1981 - 2006, the gross output value of farming was 4.3% and gross output value of agriculture was 5.5%. Compared from the period of 1954 - 1981 of 2.9 and 3.3% respectively. In terms of value added overall, it was 4.2% for 1981 - 2006. And 2.7% for 1954 - 1983.[20]

Real Gross Value Added was 4.5% from 1978 to 2003, up from the growth rate of 2.2% from '52 to '78.[21] Labor productivity from 1957 to 1978 declined by 0.19%, but from 1987 to 1994 it increased by 3.05%. In terms of aggregate gross value added, from 1957 to 1978, it was 1.72% compared to 5.52% from '87 to '94.[22] Labor productivity from 1952 to 1978 only grew by 0.2% per anum, from 1978 to 2003 it grew by 4% per anum. Over the course of 1952 to 1978, labour productivity in agriculture only increased by 4.3%. While labour productivity from 1978 to 2003 increased by 3.65x[21]

The effect of decollectivization and the improvement in the intersectoral terms of trade was to eliminate much of underemployment (in the form of loitering); labour inputs (in terms of hours worked) surged in the late 1970s and early 1980s. Following the second land reform, every minute was made to count on the family farm.[23]

Industrialization and Automation

From a semi-industrial nation in 1978, China is now the world's biggest producer of concrete, steel, ships and textiles, and has the world's largest automobile market.[24] From 1975 to 1992, China's automobile production rose from 139,800 to 1.1 million, rising to 9.35 million in 2008.[25] Light industries such as textiles saw an even greater increase. Chinese textile exports increased from 4.6% of world exports in 1980 to 24.1% in 2005. Textile output increased 18-fold over the same period[26] China is a world manufacturing superpower, owning a 28.7% share of the global manufacturing output, the largest in the world.[27]

The Chinese experience is based on industrialization: industry represented 35% of GDP in 1970 to 42% in 1990. The decline in percentage terms of agriculture, went from 38% of GDP in 1970 to 27% in 1990… The pattern of industrial growth during the 1980s has favored light industry, much of it in collective enterprises and, to a lesser extent, private firms as compared to substantially lower, though supposedly still rapid, growth in heavy industries in state-owned enterprises.[28]

Chinese robotic installations have grown rapidly, becoming the world leader in robotics by 2019. The fastest growth in robotics installation out of any country. By 2016, China has become the largest operational stock of robots.[29]Even when compared to the USA, a supposed first world developed country, China's robot density (robots there are per 10,000 workers) outpaces them.[30] China's commitment to automation can be seen in the rural sector, such as intelligent green houses with more commitment to robotizing the farming industries. With the mechanization rate in urban sectors at around 70% by 2020, the number is bound to increase.[31]

Labor productivity improved dramatically after reforms too. Labour productivity per worker peaked in China in 1966, and went under periodic rises and dips over the course of 1966 to 1976. It was only in 1978 that industrial productivity beat the historical 1966 peak.[32] For state enterprises, total factor productivity from 1980 - 1996 increased 1.7% per year, meaning a 27.2% increase within the 16 year span.[33] Compared to only 0.9% in 1965 to 1978.[34] For light industry's output value grew by 8.7% per anum from 1952 to 1978. From 1978 - 1999, it grew 15.25%. For Heavy industry, it was 11.9% from 1952 to 1978, but 14.75% from 1978 to 1999.[35]

Between 1978 and 1998, Chinese value-added per worker in manufacturing more than doubled in real terms, and in the process rose more quickly than in any of Japan, the USA and Russia. A process of catch-up was under way, especially in respect of Russia; the ratio of Chinese to Russian labour productivity narrowed from 16 to 54 per cent, as a result of poor Russian and improved Chinese performance.[36] Value added per worker from 1990 to 2003 increased by 600%. During the same time period, Brazil and Mexico had stagnant growth, not exceeding more than 20% during the same time period.[37]

At the end of 1952, China's gross value added in manufacturing was 3.4% of the American level. By 1978, the gross value added in manufacturing of China was roughly around 14% of the USA's level. By the end of 1994, that number has risen to 45%. From 1952 - 1978, China's GVA as a percentage of the USA's grew by 10.6%. From 1978 to 1994, that number grew by 31%. This means that the GVA in manufacturing for China increased 2.9 fold post-reform compared to pre-reform. GVA per capita as a percentage of the USA was around 5.8% at the end of 1978 (with a 0.5% growth rate from 1952 to 1978), that number increased sharply by the end of 1994 with it being 9.5% (with a 3.7% growth rate from '78 to '94) This means that from 1978 to 1994, per capita growth increased 7 times over the pre 1978 level.[38]

From 1952 to 1978, labor productivity in industry and construction increased 2.11x, while from 1978 to 2003, it increased 6.21x. In yearly measurements, from 1978 to 2003 grew 6.5% per annum, compared to the 3.7% from 1952 to 1978.[39] Labor productivity as a percentage relative to the USA grew by 4.3% from 1978 to 1994, compared to 0.4% from 1952 to 1978.[38]

  1. ↑ Lifting 800 Million People Out of Poverty – New Report Looks at Lessons from China’s Experience
  2. ↑ China to become first to realize UN goal of 'No poverty'
  3. ↑ Areddy, James T. (November 23, 2020). "China Says It Has Met Its Deadline of Eliminating Poverty"
  4. ↑ "Poverty headcount ratio at $1.90 a day (2011 PPP) (% of population) | Data". data.worldbank.org. Retrieved June 1, 2019.
  5. ↑ Share of population living with less than $2.15 and $3.65 per day, China, 1981 to 2019
  6. ↑ Poverty: Share of population living on less than $6.85 a day, 2021
  7. ↑ China Statistical Yearbook, 2014, p. 56. China Statistical Abstract 2017, p.60
  8. ↑ China's income growth keeps pace with decade's economic expansion - PRC SCIO
  9. ↑ Global MPI Country Briefing 2023: China (East Asia and the Pacific) By Oxford Poverty and Human Development Initiative
  10. ↑ China's move to measuring relative poverty: implications for social protection - ILO
  11. ↑ China's success in increasing per capita food production - Jianhua Zhang
  12. ↑ (Source: Lin Yifu, “Institutions, Technology, and Agricultural Development in China”, Truth & Wisdom Press, 2008 First Edition, p. 19)
  13. ↑ China's Great Transformation by Brandt, Loren and Rawski, G. Thomas , pp 478 - 480
  14. ↑ China’s Rise, Russia’s Fall, Nolan. Macmillan 1995, p199
  15. ↑ Wang Bingqian, Report on the Execution of the State Budget Jor 1984 and on the Draft State Budget for 1985, (Beijing: Foreign Language Press, 1985) page 76 to 77
  16. ↑ Global Food Security Ranking and Trend
  17. ↑ Global Food Security Index 2022 on China
  18. ↑ FRAMING HUNGER, A Response to The State of Food Insecurity in the World 2012 - May 22 2013 - FAO
  19. ↑ Page 232, Chinese Economic Development - Chris Bramall
  20. ↑ Chinese Economic Development - Chris Bramall, page 228
  21. ↑ 21.0 21.1 Chinese Econonomic Performance in the Long Run: 960–2030 AD by Angus Maddison, page 80
  22. ↑ Chinese Econonomic Performance in the Long Run: 960–2030 AD by Angus Maddison, page 76
  23. ↑ The Great Reversal: The Privatization of China, 1978-1989 by William Hinton - Page 53
  24. ↑ Page 593 - Rawski, G. Thomas; et al. (2008), "China's Industrial Development", in Brandt, Loren; Rawski, G. Thomas (eds.), China's Great Transformation, Cambridge: Cambridge university press
  25. ↑ "China poised to be world’s largest auto market" - NBC News
  26. ↑ Page 588 - Rawski, G. Thomas; et al. (2008), "China's Industrial Development", in Brandt, Loren; Rawski, G. Thomas (eds.), China's Great Transformation, Cambridge: Cambridge university press
  27. ↑ China Is the World's Manufacturing Superpower - Felix Richter
  28. ↑ E Gerrard Adams, ‘Economic transition in China: What makes China different’, in ‘From Reform to Growth’, p219
  29. ↑ China breaks historic records in automation
  30. ↑ China overtakes USA in robot density
  31. ↑ Automation can help Chinese horticultural industry
  32. ↑ China's Economic Development by Chris Bramall - page 403
  33. ↑ Chinese Economic Development by Chris Bramall, page 416
  34. ↑ Chinese Economic Development, page 403 - Chris Bramall
  35. ↑ Chinese Economic Development, page 409, Chris Bramall
  36. ↑ China's Economic Development, page 417 by Chris Bramall
  37. ↑ Fear of China: Is There a Future for Manufacturing in Latin America? - Mauricio Mesquita Moreira
  38. ↑ 38.0 38.1 Chinese Econonomic Performance in the Long Run: 960–2030 AD by Angus Maddison page 82
  39. ↑ Chinese Econonomic Performance in the Long Run: 960–2030 AD by Angus Maddison, page 80
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