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The Economic Distance Between China and India, 1955–73

Published online by Cambridge University Press:  17 February 2009

Extract

Recently there has been renewed interest among economists for a comparative analysis of Chinese and Indian economies. Such comparative analysis is natural considering the similarity of size, population, historical background and contemporary significance of the two countries. For the economist, study of the objectives, priorities, development strategies and resource mobilization techniques, and the end-result of the same in terms of growth rate, distribution and stability in the two countries, have major academic rewards.

Type
Research Note
Copyright
Copyright © The China Quarterly 1977

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References

1. See, for example, Swamy, Subramanian, Economic Growth in China and India: A Comparative Appraisal (Chicago: University of Chicago Press, 1973)Google Scholar. The American Economic Association devoted a session of its December 1974 annual conference to the same subject, and papers presented in that session have been published in the American Economic Review, Vol. LXV, No. 2 (05 1975)Google Scholar.

2. China: A Re-assessment of the Economy: A compendium of papers submitted to the Joint Economic Committee, Congress of the United States, Washington, D.C., USA (10 07 1975)Google Scholar. Hereafter abbreviated Re-assessment.

3. Except for some meticulous Japanese businessmen and an occasional Pakistani official, most of the visitors to the People's Republic of China have brought back precious little in terms of national statistical aggregates. Even the “high-powered” Joan Robinson and J. K. Galbraith have returned empty-handed.

4. Some like Professor Thomas Rawski have averred that Chinese official data grossly understate the actual performance.

5. See note 2 above.

6. It is regrettable that such warranted caution is absent in the papers presented in the AEA 1974 Session referred to in note 1.

7. These problems have been discussed in Swamy, Economic Growth. The theoretical index number issues have been discussed in Samuelson, Paul A. and Swamy, Subramanian; “Invariant economic index numbers and canonical dualityAmerican Economic Review, Vol. 64, No. 4 (09, 1974)Google Scholar.

8. The very high relative output ratio for sewing machines is puzzling, since the ratio of cotton cloth is so low. Part of the reason may be the fact that stitching textile machines are included in the category “sewing machines” in China, but not in India. Another reason may be that China exports sewing machines relatively more than India.

9. For instance, see the opinions expressed by Richman, B. and Weisskopf, T. E. in American Economic Review, Vol. LXV, No. 2, pp. 345–64Google Scholar.

10. It is significant that (the data in the Appendix Table show) the production of 13 out of the 16 commodities in India in 1973 is either less or about the same as in 1969. The three exceptions are electric power, bicycles and motor vehicles. But recent evidence from China and India shows the trends since 1969 may not persist.

11. In 1965, India experienced a severe drought while China harvested a bumper crop. Therefore the 1965 relative ratio for foodgrains is abnormally high.

12. A few scholars have worried about this question, for example, Perkins, D. H., “Constraints influencing China's agricultural performance” in Re-assessment, p. 357Google Scholar.

13. For years, R. M. Field refused to include small plant output in industrial production, and was critical of those who did. But between the 1972 Assessment and 1975 Re-assessment he changed his mind, without giving any reason, and included small plant output in industrial production. This meant doubling of output of fertilizer and cement, and a substantial increase in output of other commodities.

14. Field, R. M., “Civilian industrial production in the People's Republic of China,” Re-assessment, p. 169Google Scholar.

15. For example, the sweeping comment, “China has done considerably better than India in the last 24 years or so with regard to most indicators of economic development” [emphasis added], cf Richman, Barry, “Chinese and Indian development: an interdisciplinary environmental analysis,” American Economic Review, Vol. LXV, No. 2 (05 1975), p. 345Google Scholar.

16. It should be recalled that this conclusion is based on an uncritical acceptance of the latest, updated-revised Chinese data presented in Re-assessment, 1975.

17. For Appendix, see p. 382.