Published by EH.Net (January 2023).

Debin Ma and Richard Von Glahn, eds. The Cambridge Economic History of China: Volume II. Cambridge: Cambridge University Press, 2022. 845 pp. $155 (hardback), ISBN: 978-1108425537.

Reviewed by Jamin Andreas Hübner, LCC International University and University of the People.

The second volume of The Cambridge Economic History of China picks up where the first volume left off (reviewed here). It covers 1800 to the present, which includes major turning points in the evolution of China’s economy. The most notable include Britain’s conquest of the flourishing Qing dynasty in the 1840s, its eventual collapse and the creation of the Republic of China in 1912, Mao’s establishment of the People’s Republic of China in 1949, the “Reform era” (post-1978), and the most recent phase (post-Great Recession), which is a return to top-down planning and Party conformity.

For over 2,000 years, “China has sustained the largest single human society on the planet through the development of one of the most sophisticated agrarian systems in history” (p. 87). Before British colonization of China, the Chinese empire was “the largest economy on earth” (p. 531), where the “Qing…enjoyed standards of living comparable or even superior to those of Europe” (p. 83). There was little indication that things would change. But the Opium Wars did just that. While trade with the West was fairly limited up to this point, the victorious British forced “free trade” (p. 83)—requiring that China open its ports abroad. As with any major change in trade, this was viewed as an investment blessing to some, but also “as a destructive force capable of impoverishing certain sectors of the population and economy” (p. 365). Furthermore, “foreign nationals were exempt from the jurisdiction of Chinese law” (p. 414).

This “semicolonial” subordination (p. 415) to western power inaugurated a great reversal that Kenneth Pomeranz, Andre Gunder Frank, and others have written about. Contrary to ordinary, Eurocentric history, Western economic dominance (1850s-2008) was not a long-term, inevitable result of superior institutions founded over 2,000 years ago, but a highly contingent blip on the screen of Asian dominance in the world system. The book traces out these dramatic changes in chapters covering ideology, institutions and enterprises, finance, money, markets, business organization, foreign trade and investment, education, and other areas up to and beyond the Maoist era.

Readers may find interesting the unusual role played in the Chinese economy by Christian missionaries —who poured into the country starting in the 1860s. By the 1920s, “94% of Chinese counties had records of a missionary presence” (p. 391). This led to the development of a huge number of schools with new curriculum, as well as hospitals. “A great majority of the subjects in the curriculum of the new schools were novel to the Chinese” (p. 393), and improved healthcare opportunities facilitated further population growth (p. 394) and perhaps more critical reflection that helped the revolts of 1911. Readers also learn that (in crude and simplistic terms) “Communism and violent Communist movements originate from Christianity, and naturally the Christian church was essential for the creation of the first totalitarianism” (p. 541). That is, similar to Europe and Catholicism, the institutional churches and movements involved in China validated and empowered state ambitions.

The road to Chinese economic and political statism was gradual. “As early as 1912, Sun [Yat-sen] stated that all major industries in China should be owned by the state” (p. 185); China had to make up for lost time in industrialization. The world wars and threats of Japan provided further reason or opportunity to centralize economic control (p. 165, 186-87). The “institutional genes” of “imperial institution and secretive organization” (p. 543) also contributed to this move. By the time of Mao, the road to totalitarianism had already been laid, and Mao explicitly took Stalin’s model to greater extremes. However, some contributors contend, “Totalitarianism is foreign to the Chinese. When the CCP was established in 1921, the number of Chinese who knew constitutionalism was far more than those who knew Marxism or Bolshevism” (p. 543). There was nothing inevitable about China’s turn towards totalitarian communism—anymore than industrialization and capitalism was inevitable for the British over a century earlier. Whatever the case, the advent of the Maoist period was filled with contradictions not unlike the Bolshevik Revolution. Just as the Bolsheviks promised economic democracy and worker control but then reneged in 1918, so the Chinese Constitution “recognized the peasants’ rights to private land and the property rights of the owners of private firms”—only to nationalize/collectivize a year later (p. 549).

Maoism is popularly known for its cult around Mao and the “Great Leap Famine” (1958-1961), where about 30 million people (needlessly) died. This was apparently caused by (a) the use of grain to finance industrialization and repay Soviet debt instead of feeding Chinese people, (b) the cruel confiscation of metal from the population (including cooking tools) to support industrialization, and (c) the consolidation of agricultural cooperatives into ineffective “gigantic peoples’ communes” (p. 645). By this “Great Leap,” China would become “self-reliant,” and never worry about being colonized by the West again (p. 717-19). Maoism as a whole did eliminate excess wealth inequality, increase life expectancy and primary education, and achieved  “food security”; and China “fared better than many other countries—Meiji Japan and Industrial Revolution Britain come to mind—during the early stages of their industrialization” (p. 639). The Maoist consolidation also, in some ways, made the reform era more effective (p. 733), if not simply provided the industrial infrastructure for the next, and most successful phase of all (1970s-2008).

Formal recognition of private property came back in 2004 and, with other reforms, spurred a surge of private enterprise. Private investment, financial reform, entry in the WTO in 2001 (though see p. 827), and less restrictions empowered China’s economy. The Great Recession and Xi Jinping’s grand visions amplified—and overextended—China’s ambitions and initiated a resurgence of top-down control (p. 817-820) and a return of the leader’s personality cult. “Since 2013 all private firms and NGOs…are required to set up CCP branches within the firm and organization,” and “Discussions of constitutionalism and judicial independence are prohibited” (p. 562). Religious freedom is now being eradicated. Academics are facing new obstacles, like “restrictions on participation in international projects and conferences. Foreign textbooks now arouse suspicion” (p. 822). China is vastly better off than it was a half century ago. But the challenge is “how to overcome self-imposed obstacles that prevent improvements in knowledge and capabilities from generating intensive growth that outruns the accumulation of resources” (p. 823).

I greatly enjoyed this work, as much as the first volume. The research is incisive, clearly presented, and the volume is very cogently organized. At one point I wondered how the second volume might have been improved if the contributors had read or paid more attention to the first. I say this because second-volume contributors sometimes had contradictory different perspectives about pre-modern Chinese culture and socio-economic ideas, and this is an important topic given the stereotype of “Oriental Despotism” that economic historians are—or should be—trying to wash out of their clothes. Some discussion on the future impact relating to demographics (e.g., age, population, fertility) might also have been relevant and helpful.

Whatever the case, we stand in a very privileged position to be able to learn many lessons from such massive and historic economic system(s), and both volumes deserve a wide reading.

Dr. Jamin Andreas Hübner is a faculty member at the University of the People and a research fellow at LCC International University. He is a scholar of religion and economics, as well as an activist, and organizational leader, and is currently writing a book on cooperative economics.

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