Book contents
- Demystifying the Chinese Economy
- Demystifying the Chinese Economy
- Copyright page
- Reviews
- Contents
- Figures
- Tables
- Preface to the Second Edition
- Preface to the First Edition
- 1 Opportunities and Challenges in China’s Economic Development
- 2 Why the Scientific and Industrial Revolutions Bypassed China
- 3 The Great Humiliation and the Socialist Revolution
- 4 The Comparative Advantage-defying, Catching-up Strategy and China’s Traditional Economic System
- 5 Enterprise Viability and Factor Endowments
- 6 The Comparative Advantage-following Development Strategy
- 7 Rural Reform and the Three Rural Issues
- 8 Urban Reform and the Remaining Issues
- 9 Reforming the State-owned Enterprises
- 10 The Financial Reforms
- 11 Deflationary Expansion and Building a New Socialist Countryside
- 12 Improving the Market System and Promoting Fairness and Efficiency for Harmonious Development
- 13 Supply-side Structural Reform and Economic Transformation and Upgrading under the New Normal
- 14 China’s Economic Development and Cultural Rejuvenation
- 15 Reflections on Neoclassical Theories
- Book part
- Index
- References
11 - Deflationary Expansion and Building a New Socialist Countryside
Published online by Cambridge University Press: 12 December 2025
Translated by
Book contents
- Demystifying the Chinese Economy
- Demystifying the Chinese Economy
- Copyright page
- Reviews
- Contents
- Figures
- Tables
- Preface to the Second Edition
- Preface to the First Edition
- 1 Opportunities and Challenges in China’s Economic Development
- 2 Why the Scientific and Industrial Revolutions Bypassed China
- 3 The Great Humiliation and the Socialist Revolution
- 4 The Comparative Advantage-defying, Catching-up Strategy and China’s Traditional Economic System
- 5 Enterprise Viability and Factor Endowments
- 6 The Comparative Advantage-following Development Strategy
- 7 Rural Reform and the Three Rural Issues
- 8 Urban Reform and the Remaining Issues
- 9 Reforming the State-owned Enterprises
- 10 The Financial Reforms
- 11 Deflationary Expansion and Building a New Socialist Countryside
- 12 Improving the Market System and Promoting Fairness and Efficiency for Harmonious Development
- 13 Supply-side Structural Reform and Economic Transformation and Upgrading under the New Normal
- 14 China’s Economic Development and Cultural Rejuvenation
- 15 Reflections on Neoclassical Theories
- Book part
- Index
- References
Summary
In 1998, China experienced deflation accompanied by fast economic growth, which made many foreign scholars doubt the reality of China’s economic growth. The main cause for this paradox is overcapacity from previous massive investments. To address these challenges, this chapter introduces a new initiative called the “new socialist countryside drive.” This initiative aims to improve public infrastructure in rural areas, leverage the stock of rural demand to absorb the existing production capacity and overcome deflation. Additionally, these efforts contribute to narrowing the gap in public services between urban and rural areas.
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- Demystifying the Chinese Economy , pp. 214 - 236Publisher: Cambridge University PressPrint publication year: 2026
References
Gong, Gang, and Lin, Justin Y.. “Deflationary Expansion: An Overshooting Perspective to the Recent Business Cycle in China.” China Economic Review 19(1) (2008): 1–17.CrossRefGoogle Scholar
Lin, Justin Y. “Beyond Keynesianism: The Necessity of a Globally Coordinated Solution.” Harvard International Review 31(2) (Summer 2009): 14–17.Google Scholar
Lin, Justin Y. Fa Zhan Lue Yu Jing Ji Fa Zhan [Development Strategy and Economic Development]. Beijing: Peking University Press, 2004.Google Scholar
Lin, Justin Y. Juedu Zhongguo Wenti Meiyou Xiancheng Moshi [There Is No Textbook Paradigm for Understanding Chinese Economy]. Beijing: China’s Social Sciences Literature Press, 2007.Google Scholar
Lin, Justin Y. “Shocks, Crises and Their Determinants.” Middle East Development Journal 2(2) (December 2010): 159–76.CrossRefGoogle Scholar
National Bureau of Statistics of China. China Compendium of Statistics 1949–2008. Beijing: China Statistics Press, 2010.Google Scholar
Rawski, Thomas G. “What’s Happening to China’s GDP Statistics?” China Economic Review 12(1) (December 2001): 298–302.CrossRefGoogle Scholar
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