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Structural Challenges to Sustained Economic Growth in China

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  • Dwight H. Perkins
Abstract
This essay focuses on three broad sets of issues that may not slow China's GDP growth to under 3 percent a year, but they will almost certainly create major social and physical problems that will be difficult to deal with. The first is the demographic and education challenges featured by a rapidly aging population combined with a large share of the population being under‐educated. The second is the environmental challenges China faces in achieving the state goal of carbon neutrality by 2060. The third challenge is low consumption and unprecedentedly high investment, a strategy that has driven China's high growth rates in the past decades but is no longer sustainable. These three challenges are intertwined, making China's adjustment path even more uncertain. What would a sustainable development strategy involve? The clearest need is to shift investment away from energy‐intensive housing and infrastructure and toward investment in people.

Suggested Citation

  • Dwight H. Perkins, 2023. "Structural Challenges to Sustained Economic Growth in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(1), pages 22-43, January.
    • Handle: RePEc:bla:chinae:v:31:y:2023:i:1:p:22-43
    DOI: 10.1111/cwe.12457
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    References listed on IDEAS

    as
    1. Thomas Piketty & Li Yang & Gabriel Zucman, 2019. "Capital Accumulation, Private Property, and Rising Inequality in China, 1978–2015," American Economic Review, American Economic Association, vol. 109(7), pages 2469-2496, July.
    2. Chong-En Bai & Chang-Tai Hsieh & Yingyi Qian, 2006. "The Return to Capital in China," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(2), pages 61-102.
    3. Perkins, Dwight Heald, 2019. "A “hard landing” or secular stagnation in China's future: False alarm or real threat?," China Economic Review, Elsevier, vol. 57(C).
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    Cited by:

    1. Ligang Song & Yixiao Zhou, 2023. "Guest Editors' Words," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(1), pages 1-4, January.
    2. Chuanchuan Li & Lei Li & Haodan Tang & Yanyan Zheng & Fangming Gong, 2023. "Human Capital Development and Its Influence on FDI Withdrawal: An Empirical Analysis," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(5), pages 116-134, September.
    3. Ge Li & Da Gao & Yi Li, 2023. "Impacts of Market‐based Environmental Regulation on Green Total Factor Energy Efficiency in China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(3), pages 92-114, May.
    4. Haojie Liao & Lin Su & Tianyao Tang & Zhaoyan Shang, 2024. "Green initiatives and stakeholder engagement: Unveiling the impact of green strategies and CSR on financial performance from descriptive‐normative perspectives of stakeholder theory," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(5), pages 4800-4811, October.
    5. Gloria Claudio-Quiroga & Luis Alberiko Gil-Alana & Andoni Maiza Larrarte, 2025. "Persistence in China’s household consumption level: implications for the new growth model," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 49(1), pages 283-298, March.

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