The main body of this work (Chapters 2 and 3) shows that it is plausible to systematically examine the Chinese economy and, by extension, Chinese society, using theories of capitalism. The political economy framework developed for this purpose is introduced below.
Researching China from a Political Economy Perspective
Although only limited to date, political economy studies with a focus on China have provided a framework for examining the country’s development. The following presents a contingency-sensitive research framework based on a synthesis of diverse theoretical approaches. Using this framework, the present work takes a holistic perspective—for “only in a panoramic view can one truly recognize the details” (Streeck 2009, 17).
Over the next few sections, I will first look at different aspects of research into capitalist dynamics, which have also been the subject of recent comparative capitalism research.
I will then outline the concept of capitalist-driven modernity, that is, the assumption that the path to modernity or modernities over the past one hundred years in various parts of the planet can be described as a process in which drivers of capitalism extensively shape the structure of social order. This will serve to introduce key characteristics of global capitalist socialization and its unstable dynamics.
Subsequently, I will present a few observations on the reality of historical institutional change and how this can impact the capacity to act on the part of social actors. I will also discuss the roles of sociocultural idiosyncrasies or past traditions and social structures that give a specific face to political economies and create various forms of coordination between economic, political and other societal actors.
Finally, five key dimensions of capitalist systems are outlined, which will largely provide the structure for the remainder of this work.
Varieties of Capitalism and Comparative Capitalisms
In order to move closer to a conceptualization of capitalism or of its different guises in the past, I will first refer to theories and concepts found in comparative political economy (CPE), in particular, but not restricted to, varieties of capitalism (VoC) theory, which has become well known in recent years.
VoC theory (Hall and Soskice 2001) includes a differentiation between liberal (US and UK) and coordinated market economies (Germany and Japan) and serves as a contrast to the notion of a (liberal) best-practice model.5 According to this theory, market economies are composed of a cluster of functionally coordinated subsystems. Production systems, corporate governance and financing, and corporate and industrial relations, as well as training and education initiatives are examined for their institutional complementarities. Functioning complementary relationships are seen as the source of comparatively long-term institutional stability and economic growth.6
In addition, a number of insights have been developed in the CPE field over the past years that are relevant for research on China (see Bohle and Greskovits 2009; Coates 2005; Hancké, Rhodes, and Thatcher 2007; Streeck 2010a). These include the following:
• The knowledge that an in-depth examination must go beyond a strict market and enterprise focus. China’s dynamic economic development is not only a result of resurgent entrepreneurship in parts of the mainland or among the community of overseas Chinese but is also based on, and indeed very much defined by, action taken by state actors.
• The realization that the role played by power relationships, the state, and state regulation cannot be neglected. This will be examined in further detail in the remainder of this chapter.
• The identification of different types of capitalism that cannot be aligned with liberal market or coordinated market economies (LMEs/CMEs) (for examples that attempt to do this nonetheless, see Ahrens and Jünemann 2006; Wilson 2007a; Witt 2010). In critical confrontation with and yet emerging in parallel to the VoC approach, several other models have been employed to describe further (efficient) varieties of capitalism besides LMEs and CMEs that are not limited to the West. These include state-controlled, consensus-oriented, or Asian capitalism, for instance (Coates 2000, Boyer 2005, Amable 2003). Forms of state capitalism or state-permeated capitalism lend themselves particularly well for use as templates for comparative analysis (see Crouch 2005; Fligstein and Zhang 2011; May, Nölke, and ten Brink 2013; V. Schmidt 2000).
• The recognition of the need for a dynamic, nonfunctionalist analysis of historical change that takes into account targeted human action. As illustrated below, this is of major importance, not least when examining the strategic reform projects of state and party elites.
• A perception of institutional complementarities that goes beyond the VoC approach, where complementarity is seen as stemming from coherence or structural similarities among institutions. Höpner claims that this argument cannot be applied to every empirical case examined. Incoherent settings can also have productive consequences: “Complementarity can exist without coherence, and coherence without complementarity” (Höpner 2005, 356). Some authors thus use the concepts of positive and negative “externalities” (Streeck 2009, 93–146) or use the term “productive incoherence” to describe institutional side effects not originating from a coherent basis (Crouch, Schröder, and Voelzkow 2009).7
• Finally, the knowledge that studies on national economies must include a transnational focus (Bohle and Greskovits 2009; Nölke and Vliegenthart 2009; ten Brink 2014b). In the case of China, this is particularly important—here, to stay with the complementarities theme, productive transnational “cross effects” have come about over the course of reform. China has been able to benefit more than any other country from the favorable global economic conditions and advantageous circumstances in East Asia.
Taking these insights as a starting point, a more comprehensive social theoretical basis for the study of capitalist systems will be developed below.
Capitalist-Driven Modernity
In the social sciences, the latest macrotheories draw largely on the concept of “modernity” or rather “multiple modernities,” with capitalism playing a lesser role. In contrast to this, in this work I argue that capitalism, as an all-encompassing social order, has sustainably and comprehensively shaped the numerous paths to modernity across several continents over the past hundred years.
Modernity is the result of a growth in human capacity for action and reflection and is characterized by a qualitatively higher degree of autonomy —or potential autonomy—than premodern or early modern societies. Modernity is a network of relations permeated by tendencies toward independence, essentially characterized by institutions for the accumulation of wealth and power, and then expanded to include dimensions such as the normative. In advanced social science theories, such a circumstance is usually gathered into a cluster of autonomous power sources including the juxtaposition of more or less independent institutions. Discussion over the diversity of modernity results in the assumption that different legacies of civilization and macroregional or national paths have come to shape the face of each individual form of modernity (see Arnason 2003a; Eisenstadt 2006; Knöbl 2007; overview: Schwinn 2009).
Studies have been conducted on the diverse dimensions of modernity that can be found in contingent combinations. The most common of these dimensions include the processes of secularization, individualization, pacification, democratization, economization, and bureaucratization. Consequently, the analytical framework developed here is clearly limited, the main focus being on processes of economization and bureaucratization, with only occasional reference to other modernization dynamics.
I argue that economization and bureaucratization processes, interpreted in the current work as driven by capitalist imperatives, are particularly important in this context. This