How China Escaped Shock Therapy: The Market Reform Debate

China has become deeply integrated in the world economy, yet gradual marketization has facilitated the country’s rise without a wholesale assimilation to global neoliberalism. In her new book, “How China Escaped Shock Therapy: The Market Reform Debate,” Isabella Weber uncovers the fierce contest for economic reforms that shaped China’s path. In the first post-Mao decade, reformers were sharply divided: should China destroy the core of the socialist system through shock therapy, or should it use the institutions of the planned economy as market creators? With hindsight, the historical record proves the high stakes behind the question: China embarked on an economic expansion commonly described as unprecedented in scope and pace, whereas Russia’s economy collapsed under shock therapy.
Based on extensive research, including interviews with key Chinese and international participants and World Bank officials as well as insights gleaned from unpublished documents, “How China Escaped Shock Therapy” charts the debate that ultimately enabled China to follow a path to gradual re-industrialization. Beyond shedding light on the crossroads of the 1980s, it reveals the intellectual foundations of state-market relations in reform-era China through a longue durée lens. Overall, the book delivers an original perspective on China’s economic model and its continuing contestations from within and from without.
On Thursday, April 21, Isabella Weber, Assistant Professor of Economics at the University of Massachusetts Amherst, joined us for a discussion on her new book and China’s path of economic reform. This webinar is part of the Spring 2022 Global Economic Governance Book Talk Series.