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Chinese Economic Development and its Driving Forces 1000-2030

In world perspective. China’s performance has been exceptional. It is and has been a larger political unit than any other. Already in the tenth century, it was the world’s leading economy in terms of per capita income and this leadership lasted until the fifteenth century. It outperformed Europe in levels of technology, the intensity with which it used its natural resources, and capacity for administering a huge territorial empire. By 1500, Europe had overtaken China in real income, technological and scientific capacity. From the 1840s to the middle of the twentieth century, China’s performance actually declined in a world where economic progress elsewhere was very substantial. In the past half-century, China has had a rapid growth trajectory-a process of catch-up which seems likely to continue in the next quarter century. By 2030 Chinese per capita income seems likely to be equal to the world average, and it will again be the world’s biggest economy.(see the figure and table below).

China was a pioneer in bureaucratic governance. In the tenth century, it was already recruiting professionally trained public servants, recruited by examination on a meritocratic basis. The bureaucracy, schooled in the Confucian classics, was the main instrument for imposing social and political order in a unitary state over a huge area. It had no challenge from a landed aristocracy, an established church, a judiciary, dissident intellectuals, or an urban bourgeoisie, and only rarely from the military. They used a written language common to all of China, and the official Confucian ideology was deeply ingrained in the education system. This system was relatively efficient and cheap to operate compared with the multilayered structure of governance in pre–modern Europe and Japan. The institutions of such a far-flung bureaucracy reporting to and controlled by the central authority would not have been possible without the precocious development of paper and printing (500 years before Europe).

In the West, recruitment of professionally trained public servants on a meritocratic basis was initiated by Napoleon, more than a millennium later, but European bureaucrats never had the social status and power of the Chinese literati. Within each country power was fragmented between a much greater variety of countervailing forces. Europe had a system of nation-states in close propinquity. They were outward looking, had significant trading relations and relatively easy intellectual interchange. This stimulated competition and innovation to a degree not possible in China.

The economic impact of the Chinese bureaucracy was very positive for agriculture. It was the key sector from which they could squeeze a surplus in the form of taxes and compulsory levies. They nurtured it with hydraulic works. Thanks to the precocious development of printing they were able to diffuse best practice techniques by widespread distribution of illustrated agricultural handbooks. They settled farmers in promising new regions. They developed a public granary system to mitigate famines. They fostered innovation by introducing early ripening seeds which eventually permitted double or triple cropping. They promoted the introduction of new crops-tea in the Tang dynasty, cotton in the Sung, sorghum in the Yuan, new world crops such as maize, potatoes, sweet potatoes, peanuts, tobacco in the Ming.

Agricultural practice compensated for land shortage by intensive use of labour, irrigation and natural fertilisers. Land was under continuous cultivation, without fallow. The need for fodder crops and grazing land was minimal. Livestock was concentrated on scavengers (pigs and poultry). Beef, milk and wool consumption were rare. The protein supply was augmented by widespread practice of small scale aquaculture. Higher land productivity permitted denser settlement, reduced the cost of transport, raised the proportion of farm output which could be marketed, released labour for expanded handicraft production, particularly the spinning and weaving of cotton, which provided more comfortable, more easily washable, and healthier clothing.

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