This book on the Chinese economic system focuses on the pre-GFC period that represents the big take-off in Chinese growth. The author is extremely careful with his work and shows that many our assumptions on the growth drivers are either wrong or misplaced. Huang, an MIT professor, focuses on the rural entrepreneurism of the 80's is the key growth driver and the switch to urban growth that was more state-sponsored was at the expense of greater rural regulation.
The institutional framework drives incentives and behavior, so making arguments about the drivers of growth without looking closely at the detailed policies will lead to mistaken conclusions. While we are looking at economic history with Capitalism with Chinese Characters, there are lessons to be learned for today. The slowdown in China growth and fall in the stock market is closely related to the policies that promote entrepreneurship. If we change those incentives, the markets will respond in a way that will diminish growth.
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