Needham’s Paradox and the fate of China

Five years ago, one of the more eminent economists in the world, Barry Eichengreen, Professor at the University of California, Berkeley, came out with the notion that he thought China might become frozen with a middle-class standard of living and never quite making it to full advanced country status.

I think he’s probably right and it’s probably very much bound up with what is known as Needham’s Paradox. During the Second World War, Joseph Needham travelled throughout China as a special envoy of the Royal Society to help Chinese science. At the same time he collected as many ancient Chinese texts on scconce and engineering as he could and sent them back to Cambridge University. At the end of the war he then set to in writing Science and Civilisation in China which expanded to 14 volumes over the years.

What puzzled Needham then, and many more since, is why the Chinese were so innovative in earlier times — between about 900BC and 1400AD — but are not in modern times.  The Chinese government, in fact, are more than puzzled — they’re seriously worried — and this is why they allows so many scores of thousands of Chinese children and graduates to be educated and do post-graduate research abroad in the hope that when they return something will rub off.  The trouble with this policy is that the very brightest Chinese researchers are offered tenure at American and British Universities and stay there .

Actually the Chinese government are well aware of why they, like the Japanese and the South Koreans — Confucianists all — are lacking in creativity of their own. Due to years or incessant rote learning at school, their young people are too afraid to ask questions and to open their minds to lateral ideas.  China, with a sort of super-Confucianism laid on top of the normal culture — that is, the Communist Party (of which the Chinese Government are even more fearful) — is probably in an even less creative state than Japan and South Korea.  With their present economic problems — caused more by the West’s 2008 Crisis rather than any great fault of theirs — then China may get stuck in the doldrums for a very long time to come, if not permanently, as Eichenbreen was implying.

Barry Eichengreen came to his conclusion after reading China’s purely economic runes.  I am beginning to come to the same conclusion mainly on historical and cultural grounds.  Only 10 of China’s 31 provinces — coastal provinces of mainly Han Chinese — have been enterprising enough in becoming superb copyists of Western technologies.  They have certainly become middle-class in the American sense. But the other racial groups in China’s interior — and still containing something like 600 million of some of the poorest people in the world — seem to be resistant.  I don’t see  China as a whole making it.

2 thoughts on “Needham’s Paradox and the fate of China

  1. “I don’t see China as a whole making it.”

    I bet that if we had considered way back in 1978 the proposition “China will be the second largest economy in the world by 2014”, the consensus would have been “It is absolutely impossible.”

    I think it is too naive to make categorical predictions about China.

    1. Atanu,

      Some evidence that all is not going well is that as Chinese wage rates rise in the coastal provinces firms are relocating to other countries such as Laos and Vietnam instead of into the Chinese interior.

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