WI: Free Market Capitalist China?

RousseauX

Donor
Could a post-Tiananmen Democratic China try to engage in shock therapy?
The lesson of TMN was precisely that shock therapy was destabilizing: a big reason why the protests gained traction was because inflation in the late 1980s was 25% per year because the government lifted price controls on a lot of goods

They could try, it would just be stupid
 

RousseauX

Donor
in a timeline where the communist don't take over after ww2, you will have south korea and japan. both of these countries have remarkable economic growth. it would only be logical for a china that would be allied/ friendly with the USA and probably hostile to the USSR, to emulate its neighbours.
South Korea and Japan both developed under State Capitalist models, not Laissez-Faire free market
 

RousseauX

Donor
Yeah, I can definitely imagine so.

In a much earlier thread of mine, I found a well-written answer by BootOnFace that addressed this very premise. The link to it is here: https://www.alternatehistory.com/fo...italism-if-not-the-us-then-whom.443624/page-2

Besides that, what other options do we have?
you actually don't need a 19th century pod, KMT wins civil war in the 1940s, builds up a statist economy up to the 1970s or so on the back of debt. The buildup goes wrong and a series of debt crisis is followed by privatization and deregulation in order to resolve the crisis.

That's basically what you had in Latin America in the 1980s
 

RousseauX

Donor
Companies were/are free to do what they wanted.
Not really, the government owned the banking sector in south korea for instance, there were literal five-year plan style export quotas set by south korean government. Firms which met the quotas were awarded capital by the government and firms which didn't receive additional capitalization. It's an example in which the state controlled "commanding heights" were used to control the rest of the economy.

also ownership of firms were disproportionately part of conglomerates called chaebols, ownership of which were determined by the government in the first place: largely chosen based on loyalty to the regime.
 

kernals12

Banned
Not really, the government owned the banking sector in south korea for instance, there were literal five-year plan style export quotas set by south korean government. Firms which met the quotas were awarded capital by the government and firms which didn't receive additional capitalization. It's an example in which the state controlled "commanding heights" were used to control the rest of the economy.

also ownership of firms were disproportionately part of conglomerates called chaebols, ownership of which were determined by the government in the first place: largely chosen based on loyalty to the regime.
Didn't know that. What was it like in Japan?
 
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