Module One:
Introduction
Ccss4052 Urban and Regional Development in China
Dr. Kenneth NG Tsz Fung
Course Overview
Geographical Setting
China’s path to Capitalism
Changing State-society Relations in Post-Mao China
A “Geographical approach” to the study of China
Agenda
Geographical Setting
Geographical Setting
Covering an area of over 9.5 million square kilometres, China ranks as
Ethe world’s third-largest country.] → 4 Ccontroversal )
~ 3 -
Despite its vast size, the nation observes a single time zone.
The length of China’s borders shared with neighbouring countries
jk. extends beyond 22,000 kilometres.
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China maintains favourable diplomatic relations with several of these
Armistice neighbours, especially North Korea and Myanmar.
↓
s .
k .
However, there are territorial conflicts with India and Bhutan, as well as
Myanmar, and maritime disputes with Japan, Vietnam, and the Philippines.
To the east, the Pacific Ocean separates China from North America, and
to the southeast from Australasia.
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hWnasokoor china
Geographical Setting
Locations of China and its neighbouring countries in Asia
Internal Territorial Divisions
-
Provrntion level x
Provinces, autonomous regions, municipalities, and Special Administrative
Regions (SARs) constitute the highest level of the local government
hierarchy and report directly to the central government.
Officially, the administrative hierarchy progresses downward to counties
and townships. Unofficially, however, the prefecture level sits between
the provincial and county levels, with villages positioned beneath the
townships.
There are 34 provincial-level administrative divisions in total, comprising
23 provinces, 5 autonomous regions, 4 municipalities that are
independently administered, and 2 SARs.
English and Chinese names of the different provincial-
level administrative units in China
China’s highest-level
administrative units
Internal Territorial Divisions
The names of many Chinese provinces reflect specific geographical
features or provide geographical references.
The four cardinal directions are denoted by the characters 東 (dong) for
‘east,’ 南 (nan) for ‘south,’ 西 (xi) for ‘west,’ and 北 (bei) for ‘north.’
For example, Guangdong Province is located to the east, while the Guangxi
Autonomous Region is to the west.
Hebei Province is situated on the northern bank, and Henan Province on the
southern bank, of the He (Yellow River).
Similarly, Hubei and Hunan provinces are positioned to the north and south
of Hu (Dongting Lake), respectively.
Internal Territorial Divisions
The name Sichuan includes the character 川 (chuan), which means ‘rivers,’
indicative of the region’s rich river systems.
Another term for ‘river’ in Chinese is 江 (jiang).
The name of Jiangxi Province refers to the Gan River (贛江), while
Zhejiang Province derives its name from the Zhe River.
Heilongjiang Province gets its name from the Amur River, which is called
Heilongjiang in Chinese, meaning ‘Black Dragon River.’
The name Xizang refers to the region of Western Tibet, with ‘zang’ (藏)
being the Chinese word for Tibet.
China’s path to a market
economy
Elmrnatelass Enemy x
puruate properly lowfiscation 没收
potlical 政治是 v nublic property
Tndoorination 灌輸 ommunismy Market s
cowbrolled
Redistributed
Marxist ideologypitvate property
Capitatism
品 free market
Socialism was initially developed by Karl
Marx as a response to the rise of
industrial capitalism in the early 19th
century.
Its main goals were to eliminate the
capitalist economy, which is based on
market exchanges, and to establish a
socialist society founded on the principle
of common ownership.
Marxist ideology
階楷級 Marx believed that capitalism is destined to fail due to the
爭 irreconcilable conflict between the bourgeoisie, or capitalist class, and
the [proletariat,J or working class.
→
The capitalist class systematically exploits the working class by extracting
無產 ‘surplus value’ from their labour.
階
A series of economic crises would inevitably lead the proletariat to full class
consciousness, transforming it into a revolutionary force.
This would spark a proletariat revolution, leading to a transitional
‘socialist’ period. Over time, this would evolve into a classless and
stateless ‘communist’ society.
鬥
19 anbuny vo
centuny Uid no
centuny CAfer
949
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帝國主義 SouTalism commurnism
个
mperTalism →
QunsT- colony~ 7 ~
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Fedualism 封建主義 来殖 地
一
民
Central features of a
capitalist economy
Based on private ownership and organised by the market
A commodity, being a good or service that has a market value, is produced
for exchange.
Productive wealth is largely controlled by private individuals or entities.
Economic activities are structured around market principles, which are driven
by the forces of demand and supply.
The allocation of resources is determined through the price mechanism, where the
ability to pay dictates who utilises resources and consumes final goods and
services.
Material self-interest and the goal of profit maximisation serve as the
primary motivations for enterprise and diligent work.
Central features of a
socialist economy
This system of production is focused on use and aimed at fulfilling human
needs.
Productive wealth is predominantly under public or common ownership.
Strategic industries such as public utilities, natural resources, heavy industry,
transport, and the regulation of both foreign and domestic trade are included.
Economic organisation relies on planning, which is intended to be a[rational
approach to resource allocation.了按比例分佈使
ε Work is carried out through cooperative] efforts, motivated by the aspiration
Work for general well-being.
IS mlssTon
一
China’s macroeconomic
performance
Growth performance before
and after 1978 differs
significantly.
Prior to 1978, the average
growth rate of real GDP in
China was a modest 3% per
year, not much different from
the growth rate in the United
States.
However, between 1978 and
2010, China’s growth in per
capita GDP accelerated to a
rate of over 8% per year.
China’s macroeconomic
performance
China has been the fastest-growing
economy in the world.
Throughout the 1980s, its GDP grew at an
impressive average annual rate of 10.2%.
This rapid pace continued from 1990 to
1996, with the average annual rate of
growth for real GDP reaching 12.3%.
Even in the 2000s, China was able to
sustain a high single-digit growth rate.
Why, then, did China’s growth
performance differ so markedly before
and after 1978?
Government-led
industrialization before 1978
The Chinese government thought that the
most effective way to speed up the
industrialization process was by
increasing investment in heavy industries,
e.g., steel, concrete, and heavy
machinery.
It mobilised resources by limiting
household consumption and setting low
prices for agricultural goods, resulting in
forced savings and surpluses extracted In rural China under Mao, meals were eaten in the
from the agricultural sector. commune mess halls.
Government-led
industrialization before 1978
Incentive problems in the rural sector significantly reduced the
productivity of farmers.
In the late 1970s, the agricultural sector, which employed more than 70% of
the labour force, was not even able to provide China’s population with 2,300
calories per capita per day.
The inefficiency of the manufacturing sector was also notable.
Dominated by state-owned enterprises (SOEs), resource allocation and
production in these enterprises were carried out according to government
plans rather than market signals.
Government-led
industrialization before 1978
Most of the SOEs suffered from low productivity, had an excess of workers,
and were producing products for which there was no market demand.
Moreover, there were constant shortages of consumer goods due to the
limited number of light industrial firms.
Three board changes after
1978 for productivity
Gradual receding of state control over
the economy.
A shift in economic control without
privatisation.
Steady growth in foreign investment.
Gradual emergence of a rational legal
system to support economic changes.
For example, the 1994 Labour Law has
The famous saying coined by Deng Xiaoping,
given workers the freedom and mobility to “crossing the river by feeling the stones”, aptly
find new employment. describes the pragmatic and gradualist features
of the post-1978 reforms.
Three board changes after
1978 for productivity
Contrary to the ‘shock therapy’ or ‘Big Bang’ approach to economic
reform—advocated by some Western scholars, which emphasizes the
institutional foundation of a market economy through private property
and insists on the privatisation of industry and other public assets—
China’s post-1978 reforms achieved success through two key factors:
Retaining the government’s role as a [stabilising force,了 for example,
through thecdual-track system.了 This system allowed state-owned enterprises
(SOEs) to remain partially on the planned economy track while giving them
incentives to generate additional income.
cDecentralizing ownership-like control within the administrative hierarchy
to local governments,] thereby creating an incentive structure among local
administrators.
vcompelition
localrtres botweek diffeertpropers
Responsibility of
system ( poperty )
Deng’s reform agenda
Transforming incentives in the agricultural economy by allowing farmers
more control over their production and profits.
Forcing the central government to grant local bureaucrats a degree of
economic authority over the areas they administer.
Creating a system that kept in place the planned economy while at the
same time granting autonomy over local enterprises.
Addressing the economic burden that the social security system posed for
Chinese enterprises.
Facilitating the development of a private economy.
Attracting foreign direct investment.
Developing an independent
mindset in the rural economy
The establishment of the[Household Responsibility System了 in the early
1980s allowed peasants in rural areas to lease land and produce
agricultural goods on a household basis.
They were still required to deliver Ea minimum quota of grain了 to the
government, but beyond that amount, theyc were free to sell any surplus了in the
emerging rural markets.
↓
This policy shift resulted in three immediate (positive consequences:7
Increased cash flow into individual households, with the average per-capita
income rising to 133.6 RMB in 1978.
A stimulation of grain output, which grew from 305 million tons in 1978 to
407 million tons in 1984.
The creation of incentives for individuals to produce more efficiently.
Local governmental
autonomy
Economic decentralisation
Prior to 1979, the central government was in charge of tax collection and
the redistribution of profits to the provinces. However, with the introduction of
the fiscal responsibility system in the 1980s, local governments were
permitted to keep a substantial portion of [ tax revenues了 and cprofits from
township enterprises.]
The growth effect of economic decentralisation worked through two forces:
Local officials who possessed a [ deeper understanding of the unique strengths,]
opportunities, and needs of their regions were granted the autonomy to pursue
diverse development[strategies tailored to their localities.了
There was an introduction of competition among local officials, who vied for
various economic opportunities, fostering a responsive economic environment.
Local governmental
autonomy
[ Political decentralization了 has been exemplified by measures such as
authorizing Guangdong and Fujian Provinces to formulate their own
economic regulations for theirESpecial Economic Zones.了
This empowerment allowed individual provinces and municipalities to
assume control over economic decisions and to innovate in their
developmental strategies.
Autonomy and incentives
for factory managers
i
The [dual-track system allowed for the growth of the economy out of the
plan by introducing market mechanisms alongside it.
This system facilitated the coexistence of two coordination mechanisms了 within the
state sector—the
[ plan and the market.了 Under this system, commodities would have a
two-tiered pricing structure: one price set by the state under the planned economy
(typically lower) and another determined by market forces (typically higher).
State firms were permitted to sell their products above the planned quotas and
retain the extra profits, creating an incentive for them to adopt market-oriented
strategies without completely discarding the planned economy structure.
This approach not only incentivised[state-owned enterprises (SOEs)J to become more
efficient and responsive to market demands but also provided a degree of stability
during the economic transition process.
Autonomy and incentives
for factory managers
The transition was a gradual process
where the plan’s importance diminished
over time, allowing the economy to
outgrow the planned system.
For instance, consider the sales and
allocation of finished steel. Until 1984, the
central government’s allocation of steel
increased proportionally with production.
However, post-1984, c the quantity
allocated by the central government
stabilised,了and nearly all the additional
production was directed to the market.
Transforming the social
security system
[The end of lifetime employment (known as the ‘iron rice bowl’)
In the pre-reform era, employment came with a range of benefits tied to the
workplace. Wage differentials were minimal, and upon entering their work
unit, workers were integrated into a social system that provided their salary,
housing, medical insurance, and other necessities.
The state upheld its commitment to securing employment for everyone, a
promise that was gradually reformed through institutional changes.
These reforms included the introduction of a new pension system, which does
not fully cover the costs of retired workers.
The 1994 Labor Law alleviated work units from the substantial future burden
of a lifetime commitment to their workers, signalling a move towards
redefined labour relationships.
一
Developing a private
economy
Although China did not rapidly advance on the path of privatising SOEs,
the government did permit the rise of a private economy.
This emergent private sector played a crucial role in showing the state sector
how to compete. State-owned factories were not privatised, but they faced
market competition from the growing private sector.
② The private sector consisted of three key components:
[Small-scale entrepreneurs了 within the household economy, a legal category
restricted to no more than seven employees, were vital in the early reform
years as they provided employment opportunities for the many individuals
awaiting jobs.
③ Private enterprises that operated outside the household economy category.
① [Publicly listed companies,] which, despite their public status, still had
ownership and control predominantly in the hands of the state.
Changing State-society
Relations in Post-Mao China
State-society relations
during the Mao era
In the state-dominated society, the party-state controlled every aspect
of social life through mechanisms like the hukou residential registration
system and the work-point system and food allocation system.
制度了 required rural residents to belong to a production brigade
Thec hukou system
and a [people’s commune,I which inhibited [ geographical mobility了 and
mandated engagement in[agricultural activitiesJ according to the state plan.
[Urban residents了 were required to belong to Ea work unit了 (danwei), such as
government agencies, public organizations, and industrial organizations.
These danweis were central in providing jobs, houses, healthcare, and other
essentials, embodying the state’s pervasive influence over individual lives.
戶
口
State-society relations
during the Mao era
Total state control led to a highly
homogeneous society characterised by
E dull conformity.] This uniformity was
evident in various aspects of daily life:
People commonly wore similar [ blue Mao
jackets,了 had [similar hairstyles,了 and [rode on
the same brand of bicycle.]
Workers received similar low salaries from
state-owned factories, reflecting a narrow
wage differential.
Spending and [consumption,了 whether it was
for foods or other goods, were regulated
according toEcoupons or quotas了 controlled by
the government, limiting individual choice
and reinforcing societal uniformity.
State-society relations
during the reform years
Changes in Rural Areas
The social structures in rural areas also underwent notable changes, with the
abolishment of people’s communes leading to the creation of local townships
and local economic committees. Peasants were ‘liberated’ from the state
control over economic activities, giving them greater autonomy.
The rapid development of [Township and Village Enterprises (TVEs)]addressed
the issue of surplus labour and provided new sources of income.
However, these changes also led to anc increasing income gap了 between the
wealthiest households and the general public.
Cadres capitalised on their official positions, converting them into revenue sources.
Additionally, someE rich peasants accumulated wealth swiftly了 through[ specialised
agricultural production了 or by diversifying into( local trade了 and transportation.
State-society relations
during the reform years
Changes in Urban Areas
Gradual Industrial reforms encompassed several key changes:
Decentralizing control of enterprises by empowering enterprise managers,
allowing them greater decision-making authority.
Creating markets for inputs and outputs to encourage efficiency and
responsiveness to market demands.
Reducing state control over urban services, thereby increasing the role of market
mechanisms in service provision.
Mandating that managers adhere to market rules, which included implementing a
bonus system and gaining the authority to dismiss workers.
These reforms transformed the previously stable, equitable work environment
into a new landscape characterized by instability and competition.
As a result, the income gap widened, marking a growing disparity between
the general public and the emerging wealthy class.
Changes in social mobility
The increase in rural-urban mobility has indeed had profound effects on
the dynamics between rural and urban societies in China.
Providing human Crime
resources for the low- Unhealthy economic
level jobs activities
Mitigating the Overloaded urban
income gap between services and facilities
rural and urban areas
The development strategy cprioritised immediate economic growth over the
sustainability of social and political systems.了
A “Geographical approach”
to the study of China
Growing differences across
China
The pace of changes in China’s economic landscape varies considerably
from place to place, with the most dramatic transformations observed in
the coastal areas. Among these, four economic regions are emerging as
particularly significant:
The Pearl River Delta Region, also known as the Greater Bay Area
Encompasses the triangle formed by Hong Kong/Shenzhen, Guangzhou/Dongguan,
and Macau/Zhuhai.
Known for its long-standing shipping, commercial, and capital connections with
Southeast Asia and the broader world economy.
The Yangtze River Delta Region, alternatively referred to as the Lower
Changjiang or Shanghai/Sunan region
Recognized for its powerful manufacturing base and trade economy.
Maintains strong economic ties with Taiwan and is an integral part of the global
trading system.
Growing differences across
China
7 pliticalyubol
The Beijing-Tianjin Region
Serves as the political power centre of the
country.
Functions as a major commercial and
manufacturing hub, with a solid foundation
in banking, high-tech industries, and
research.
Acts as a critical educational center known
for its powerful research-and-
development capabilities.
The Shandong Economic Region lroniz
"
Notable for its strong and growing trade
and commercial ties with South Korea.
Its coastal proximity facilitates
international trade and cultural exchanges.
Growing differences across
China
transportation
Por
I
Western China remains less
developed due to a variety of factors:
ESpatial Isolation:J The region’s remote
location results in high transportation costs,
which hinders economic development.
[Harsh Climate:了 The predominantly dry
and difficult climate poses challenges for
agriculture and settlement.
Lack of Political and Economic Power
This east-versus-west divide prompted
the Chinese government to initiate the
E ‘Develop the West’ policy in 2000, 了
aiming to stimulate economic growth
and reduce regional inequalities.
Growing differences across
China
Unequal economic growth and development have created many new
social, cultural, and political problems that vary significantly by location.
It is inappropriate to make broad generalisations about China or the Chinese
people; however, a spatial ‘Geography’ can provide insights into China’s
economic and social changes, challenges, and outcomes.
A
Modern China is explored in terms of two geographic themes:
China’s spatial organisation, including its rapidly growing links to the
changing global system.
The human occupancy and use of the many types of environments.
Exploration of change across space and time is crucial.
References
Guthrie, D. (2012). Setting the Stage: A primer to the study of China’s
economic reforms. China and globalization: The social, economic and political
transformation of Chinese society (pp. 27-70). Routledge.
Liou, K. T. (2000). State-society relations in post-Mao Chinese economic
reforms: changes and challenges. International Journal of Economic
Development, 2(1), 132-154.
Veeck, G., Pannell, C. W., Smith, C. J., & Huang, Y. (2007). China’s geography:
globalization and the dynamics of political, economic, and social change (pp. 1-
20). London: Rowman & Littlefield.
Zhu, X. (2012). Understanding China’s growth: Past, present, and future. The
Journal of Economic Perspectives, 26(4), 103-124.