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Article

Explaining Political Economy of China's Transition to Market: "Multiple-Track" Model

The paper casts doubts on explanatory potential of the models of “incremental double-track transition” (Fan Gang, Zhang Yu etc.) and “system’s self-withdrawal” (M. Csanadi) widely applied to the analysis of market reforms in China by some Chinese and foreign scholars. According to “incremental reform” concepts, the successes of market transition in China are attributed to the gradual decrease of “plan economy space” and simultaneous increase of “market economy space” which became possible mainly due to introduction of “double-track” price reform in the early 1980s. According to “system’s self-withdrawal” approach that in China there is “absolute shrinkage” of the “plan economy net” which makes China’s transition qualitatively different from the former East-European and Soviet experience with market oriented reforms. The paper below examines methodological pitfalls as well as empirical discrepancies of these approaches and elaborates on the concept of “multiple-track” model which may better explain the dynamics of systemic changes and continuities in China’s transition to market economy.