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Structural Change and Economic Development in China and India

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  • Vittorio Valli
  • Donatella Saccone

Abstract

The comparison of the periods of rapid economic growth in China since 1978 and India since 1992 markedly show different patterns of development and structural change. However, both countries experienced some advantages of "relative economic backwardness" and some aspects of the "fordist model of growth". China had an anticipated and deeper structural change, spurred mainly by economic reforms and the growth of the internal market in the 1980s, and, since the mid-1990s, by a very rapid penetration of its industrial products in the world market. However, a substantial part of China's exports in medium and high tech sectors are due to joint-ventures with foreign multinationals. India had a more balanced structural change and a slower insertion in the world market, although some sectors, such as software, steel, automotive and pharmaceuticals are recently increasing their share in the world markets. Owing to the huge number of micro-enterprises and the great size of the informal sector, India benefited much less than China from the economies of scale and from the third wave of the "fordist model of growth". Both countries, but in particular China, experienced negative externalities of this recent phase of rapid growth, such as higher inequalities, pollution and urban congestion.

Suggested Citation

  • Vittorio Valli & Donatella Saccone, 2009. "Structural Change and Economic Development in China and India," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 6(1), pages 101-129, June.
    • Handle: RePEc:liu:liucej:v:6:y:2009:i:1:p:101-129
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    References listed on IDEAS

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    Cited by:

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    2. Saccone Donatella, 2011. "Potenze economiche emergenti: Cina e India a confronto.Istruzione e diseguaglianze," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201113, University of Turin.
    3. Heshmati, Almas & Kumbhakar, Subal C., 2010. "Technical Change and Total Factor Productivity Growth: The Case of Chinese Provinces," IZA Discussion Papers 4784, Institute of Labor Economics (IZA).
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    6. Enrico Marelli & Marcello Signorelli, 2011. "China and India: Openness, Trade and Effects on Economic Growth," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 8(1), pages 129-154, June.
    7. Min Chen & Longji Zeng & Yajuan Deng & Shan Chen & Xin Gu, 2024. "The Impact of Land Marketization on Urban Resilience: Empirical Evidence from Chinese Cities," Land, MDPI, vol. 13(9), pages 1-24, August.
    8. Qingjie Liu & Biliang Hu, 2019. "A Study on the Two-way Causal Relationship Between Industrial Structure Evolution and Economic Growth: Empirical Test Based on 40 Years of Reform and Opening-up in China," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 11(1-2), pages 98-118, January.
    9. Peter Howie & Zauresh Atakhanova, 2020. "Heterogeneous labor and structural change in low- and middle-income, resource-dependent countries," Economic Change and Restructuring, Springer, vol. 53(2), pages 297-332, May.
    10. T.P. Bhat, 2015. "Structural Changes in India’s Foreign Trade," Working Papers id:6603, eSocialSciences.
    11. Andres Kuusk & Karsten Staehr & Uku Varblane, 2015. "Sectoral change and labour productivity growth during boom, bust and recovery," Bank of Estonia Working Papers wp2015-2, Bank of Estonia, revised 30 Dec 2015.
    12. Furceri, Davide & Kilic Celik, Sinem & Jalles, João Tovar & Koloskova, Ksenia, 2021. "Recessions and total factor productivity: Evidence from sectoral data," Economic Modelling, Elsevier, vol. 94(C), pages 130-138.
    13. Vittorio Valli & Donatella Saccone, 2009. "Structural Change and Economic Development in China and India," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 6(1), pages 101-129, June.
    14. Sanjay Kumar, 2021. "Structural Changes and Competitiveness of the Steel Industry in India: Assessed by Productivity Growth post Economic Reforms," International Journal of Global Business and Competitiveness, Springer, vol. 16(1), pages 39-50, June.
    15. Valli Vittorio, 2009. "The three waves of the fordist model of growth and the case of China," Department of Economics and Statistics Cognetti de Martiis. Working Papers 200905, University of Turin.
    16. Vazhayil, Joy P. & Balasubramanian, R., 2010. "Copenhagen commitments and implications: A comparative analysis of India and China," Energy Policy, Elsevier, vol. 38(11), pages 7442-7450, November.
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    More about this item

    Keywords

    economic development; structural change; fordist model of growth; China's economy; India's economy;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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