HS3420 CHINA IN CONTEMPORARY GLOBAL POLITICS
NAME: K.ANJANEYULU
Roll No:HS22H029
Email:hs22h029@smail.iit.ac.in
Q:Compare and contrast Mao-era economic development strategies with Deng
xiaoping’s approach at reform and opening up the chinese economy.
Introduction
The economic policies of Deng Xiaoping and Mao Zedong constitute a central contradiction in
contemporary Chinese history. A self-sufficient command economy and drastic social change
were the main goals of Mao's revolutionary, ideology-driven campaign. Deng's approach, on the
other hand, was a practical, market-oriented reform meant to promote quick economic expansion
and integration into the international system. With this change, China transitioned from a period
of disastrous social experimentation to one of unheard-of economic prosperity.
The Nature of Leadership and Political Context:
One of the greatest ideological leaders was Mao Zedong. His revolutionary aims of eradicating all
"bourgeois" components and a never-ending class struggle were inextricably linked to his programs. He
saw economic growth as a tool to achieve an ideological goal—the establishment of a pure, equitable
communist society—rather than as an objective in and of itself. Economic choices were frequently based
on political campaigns rather than good economic considerations, and the party had complete control over
the economy. Two of the best instances of this are the Cultural Revolution and the Great Leap
Forward. In order to further their ideological goals, these large-scale groups brutally disrupted the
economy.
In contrast, Deng Xiaoping was the epitome of pragmatism. He was acutely aware of the financial and
personal costs of Mao's extremism, having been purge twice during the Cultural Revolution. Deng's main
conviction was that the legitimacy of the Chinese Communist Party (CCP) rested on its capacity to raise
the quality of life for its constituents. His well-known statement, "It doesn't matter whether a cat is
black or white, as long as it catches mice," sums up his results-driven methodology very nicely. In order
to avoid the type of anarchic governance that Mao had witnessed, Deng sought to depersonalize authority
and create institutional stability by encouraging collaborative leadership and term limitations. By
separating ideological campaigning from economic strategy, he made change more logical and
experimental.
Agricultural Policy: From Collective Failure to Individual Incentive
Under Mao, the People's Communes had full collectivization of the agriculture sector. Under this system,
peasants labored on vast collective farms where their effort was unrelated to their individual production,
and private land ownership was outlawed. The state regulated all agricultural output and set productivity
goals. Extraction of agricultural surplus was the main objective in order to finance heavy industries and
provide food for the urban population. But this approach eliminated motivation, which resulted in a sharp
drop in output. An estimated 30 Millions of people perished in the Great Chinese Famine (1959–1961)
as a result of these and other terrible practices, including backyard steel furnaces and fraudulent
agricultural production reporting.
The Household Responsibility System (HRS) was the first of Deng's reforms implemented in rural
areas. Individual peasant households were given land leases under this strategy, which was a type of
de-collectivisation. Farmers may contract the land and were in charge of their own gains and losses, but
the state still owned the property. They were permitted to sell their excess produce on the open market
after fulfilling a certain quota to the state. Peasants now have a strong incentive to work harder and more
productively thanks to this change. The outcomes were striking: food shortages were eliminated,
agricultural output surged, and rural poverty fell, laying the crucial groundwork for later industrial
reforms
Industrial and Trade Policies: Command Economy vs. Market-Oriented Growth
A centrally planned command economy based on the Soviet model was the industrial strategy of Mao.
All production equipment was owned by the state, which also determined all output limits and pricing. In
order to attain national self-sufficiency and military power, heavy industry—particularly steel and
coal—was prioritised. Foreign trade and private enterprise have little to no space. This strategy resulted in
a lack of consumer products, widespread inefficiency, and technical stagnation. Innovation and
competition were stifled by the "iron rice bowl" system, which guaranteed employment and perks at
state-owned companies (SOEs).
Deng's strategy was to introduce market processes gradually and experimentally. He started the "Reform
and Opening Up" strategy, which led China to move toward international integration and away from
self-sufficiency. The establishment of Special Economic Zones (SEZs) in coastal towns such as
Shenzhen was a crucial component. By providing tax breaks and regulatory latitude to entice foreign
direct investment and technology, these areas served as capitalist testing grounds. SEZs' success made
China the "world's factory," a major player in global manufacturing. In order to allow state-owned
businesses to produce more than their planned quotas and sell the excess on the market at greater prices,
Deng also instituted a "dual-track" system. This facilitated a pivotal shift, enabling state-owned
businesses to live alongside and gain knowledge from private and international rivals, ultimately
culminating in a fully fledged "socialist market economy.
External Circumstances and Geopolitical Stance
The Cold War and a deep mistrust of both capitalist and revisionist communist countries characterised
Mao's time. China became essentially alone following its divorce from the Soviet Union. The necessity of
an independent, self-sufficient economic strategy was reaffirmed by this geopolitical isolation.
The restoration of ties with the West and a period of relative calm coincided with the introduction of
Deng's reforms. A significant opportunity was presented by the Sino-American reconciliation that
started in the 1970s. Deng understood that China's economic growth depended on world peace. By giving
diplomats the advice to "hide your strength, bide your time," he put economic modernisation ahead of
geopolitical competition.
Fortuitous Circumstances in China’s Neighbourhood
Case study :1 The Asian Tigers (South Korea,Taiwan,Hong Kong,Singapore)
By the 1980s, their economies had rapidly expanded via industrialization focused on exports. China
examined its achievements, emphasizing global commercial integration, manufacturing, and technical
advancements. Their prosperity served as a template for China's own export-driven economic expansion
while retaining political dominance.
Case Study 2:Japan’s Technological Edge and Investment
One of the first countries to invest in China's Special Economic Zones (SEZs) was Japan, a post-war
manufacturing powerhouse. Japanese businesses introduced cutting-edge technology to industries like
electronics and autos, giving China important insights into shifting from low-cost to high-value
manufacturing.
Case Study 3:U.S-China Relations (Normalisation in 1979)
Deng Xiaoping's astute diplomacy allowed the United States to invest in China by utilizing its sizable
labor population and easing China's entry into international commerce, which included its 2001 WTO
admission. This partnership increased China's exports and helped it join the global economy, while U.S.
financial and technological investments sped up China's modernization in vital areas like energy and
telecommunications.
Conclusion
These two presidents' legacies tell the story of two distinct Chinas. Despite creating a united nation, Mao's
actions left the country devastated and poor. He left behind a legacy of economic stagnation and
ideological conservatism. On the other side, Deng's reforms made China the second-largest economy in
the world and helped hundreds of millions of people escape poverty. His legacy is one of strategic
international involvement, economic dynamism, and pragmatism. Deng's economic reforms successfully
destroyed the Maoist planned economy and brought about a new age of wealth, demonstrating that a
state-controlled system could coexist with market-driven growth, even if he did not give up the CCP's
political dominance.
References:
1.Vogel, Ezra F. Deng Xiaoping and the Transformation of China. 2011.
2.Organisation for Research on China and Asia
(ORCA)https://share.google/x1KvgHCHSwDzZsiYn
3.https://www.weforum.org/stories/2025/06/how-china-got-rich-40-year-history-of-economic-tran
sformation/
4.https://pubs.lib.umn.edu/index.php/aisthesis/article/download/6058/3583/34281
5.https://pmc.ncbi.nlm.nih.gov/articles/PMC8397864/
6.Joseph, William A. (ed.), Politics in China: An Introduction, 4th Edition,
7.Chatwin, Jonathan. The Southern Tour: Deng Xiaoping and the Fight for China’s Future.
London,
