What China Can Teach Us About Economic Growth

Source: Seeking Alpha on November 22, 2017

Summary

After the enactment of US tax cuts supposedly comes infrastructure spending.

As experiences go, the latter is likely to be a bigger booster for economic growth.

While the US economy actually doesn't need any kind of stimulus right now, it does need better infrastructure.

These plans would have been much better half a decade ago when the US economy had considerable slack.

It can be refreshing to abandon preconceived theoretical (or even ideological) notions and just to look around at the world to see successful economic development and try to figure out what makes these societies tick.

For instance, we were avid studies of the post-war Japanese economic development as it seemed to fly in the face of much textbook wisdom about how economies should develop.

We argue that at the minimum, China's spectacular development, as do Japan's and South Korea's development before that, has a lot of interesting lessons to teach us about the nature of economic growth and the institutional underpinnings of capitalism.

Their success stories cannot be denied as they have played out over decades, and happened in countries of substantial size. These were large scale experiments.