Lecture 7 - Xiaoping's Economic Policy Reform and Development

Question 1

State Deng Xiaoping’s famous quote

Answer 1

“It doesn’t matter whether the cat is black or white, as long as it catches mice”

Question 2

Briefly describe China’s economic state before Xiaoping’s reforms

Answer 2

• China’s Pre-Reform State (1949-1978):
• Command economy under Mao Zedong
• Limited industrialization, poverty and isolation

Question 3

State and explain the key reforms introduced by Xiaoping

Answer 3

• Agricultural Decollectivisation: Farmers were allowed to sell surplus produce
• Special Economic Zones (SEZs): Shenzhen and other zones opened to attract foreign direct investment (FDI)
• Market Mechanisms: Gradual introduction of market principles in industry and commerce
• Global integration: Encouraging trade and export-led growth

Question 4

Briefly explain China’s economic growth during Xiaoping’s reforms

Answer 4

• Rapid GDP growth (10% per annum from 1980 to 2010)
• China became the world’s second largest economy by GDP

Question 5

What are the 3 elements of the HDI?

Answer 5

Income, health and education

Question 6

State China’s GDP growth against the growth of India and the UK

Answer 6

• China (Approx 10%)
• India (Approx 5%)
• UK (Approx <3%)

Question 7

What are some of the drawbacks associated with rapid economic growth?

Answer 7

• Income inequality: Gini coefficient rising since the 1990s
• Urban-rural wealth divide: Urban incomes 3-4 times higher than rural incomes
• Environmental degradation: Air pollution: PM2.5 levels in cities like Beijing
• Water shortages and deforestation
• Social challenges: Over-reliance on exports
• Limited social safety nets for aging population

Question 8

What were some of the long-term impacts of Xiaoping’s policies?

Answer 8

• Sustained economic reforms: Deng’s successors continued reforms.
  Shift to innovation-driven growth under Xi Jinping
• Global influence:
  Belt and Road initiative (BRI) as an extension of export-led growth.
  Trade partnerships and soft power in Africa and Asia
• Political Tensions:
  Balancing economic liberalization with authoritarian governance

Question 9

Give a brief summary of what Xiaoping did for the Chinese economy

Answer 9

Deng Xiaoping transformed China through pragmatic reforms, balancing socialism with market dynamics

Question 10

What are some economic challenges that China still faces today?

Answer 10

• Inequality
• Environmental degradation
• Political tensions