Woetzel, "The politics of China's economic opening to the outside world, 1976-86," 1988

Jonathan Robert Woetzel, Ph.D

Abstract (Summary)

In the decade from 1976 to 1986 significant change occurred in China, punctuated by the official Opening to the Outside World in 1978. This change was originally motivated by popular dissatisfaction at economic and political stagnation during the previous decade of the Great Proletarian Cultural Revolution. With the fall of the so-called Gang of Four, the economic and less clearly political roots of feudalism were acknowledged and reforms begun. Since then, China has begun to industrialize its exports, has invited foreign capital and has continued to manage its trade with an emphasis on growth.

However, with the Opening to the Outside World, interest group competition has increased dramatically. Moreover, through trade and rapid domestic development individuals have acquired more resources and in turn subjected the central leadership to greater economic and political pressure. In response, the leadership has alternately chosen to slow down or step back. The former policy has stunted growth without presenting viable alternatives (e.g., foreign exchange regulation), and the latter has had unintendedly disruptive side effects that do little to dismantle the obstacles to modernization (e.g., decentralization).

Faced with either stagnation or faction, the Opening has pushed China's leadership to build new institutional skills since 1976. The old tools of personnel union, the rule of man, and exchange restriction are no longer capable of effectively managing China's growth. Instead, the key fact of the expansion of individual abilities and the potential for much greater gains mandates the improvement of the leadership's governing skills through the rule of law, expanding information flow, and developing a financial system conducive to grassroots resource mobilization. Having succeeded in igniting change, the key issue in the next decade will be how to manage it.  

Advisor: Totten, George O.