December 17, 2019
Enormous growth rates over decades: The Chinese economy has been booming for a long time, but growth rates have slowed down recently. Is there a risk of a "middle income trap"? Are the reforms introduced under the Xi Jinping government taking effect? These are questions that Tobias ten Brink, Professor for Chinese Economy and Society at the English-medium Jacobs University Bremen, asks in the project on the stability of the Chinese economic model funded by the German Research Foundation (DFG).
Strong growth is accompanied by rising incomes and a higher standard of living. If the per capita income reaches a certain level, however, there’s a risk of the "middle income trap". This is because production costs are also rising, thereby diminishing competitiveness. The economy can no longer compete with the low-wage countries, but it is not yet developed enough to be able to compete fully with the industrialized countries in terms of product quality. "We are looking at how the Chinese government is tackling these challenges and trying to assess the impact of these measures," says ten Brink.
This is done in three comparative case studies in regions of different economic power and dynamics. These are the highly developed coastal province of Guangdong, the increasingly developing inland province of Hubei and the structurally weak province of Liaoning, the Chinese version of the US rust belt. "We want to get the most comprehensive, balanced picture possible," emphasizes Dr. Alexandre de Podestá Gomes. The Brazilian holds a doctorate from SOAS University in London, which specializes in the study of societies in Asia, Africa and the Middle East. As a postdoctoral fellow, he transferred to Jacobs University for a research project on the stability of the Chinese economic model.