How China Grows
The book I’m reading is called How China Grows: Investment, Finance and Reform by James Riedel, Jing Jin, and Jian Gao. It talks about how China has developed and grown over the past 30 years or so to become a major economic player in the global market today. It starts off with the economic reforms which began in 1979, which created “incentives and institutions” which were not present in their former socialist economy. The reform was gradual, starting off with an industrial reform from 1978-1993, an agricultural reform from 1979-1985, and finally a transition to a market economy from 1994-2003. It then gets into things such as foreign trade and investment, and how the Chinese began to save money and invest in Chinese companies and also various other investors who invested in the Chinese market from other parts of the world. The fifth chapter gets into the banking industry reform because the financial market was majorly controlled by the banking industry, and the banking industry was mostly in control of the government. The next two chapters speak about the bond markets and stock markets and how the developments in these areas have helped with the success of the Chinese industry. Finally it examines the performance of the macroeconomic policies and how China had developed and expanded throughout their reform period. It also ties together a lot of the previous chapters into explaining how the economy and Chinese market had changed for the better or for the worse during various intervals throughout 1978-2005. The one child policy is also examined and they state that China has become an ageing country long before it was due to be, since the population is starting to peak and beginning to decline and the percentage of elderly (80+) is beginning to dominate the population.