The topic of Unlikely Partners is of historic importance: the intellectual foundations of China's economic rise which reshaped the world economy. What economics underlies China's transformation is a question that has hitherto been largely neglected. Gewirtz's book thus addresses a critical gap in the literature. But to appreciate the relevance of the book it has to be situated in the larger context of the transition experience. The sharp contrast between China's growth “miracle” and Russia's economic collapse has embarrassed the mainstream of economics underlying Russian shock therapy. Gewirtz's main argument provides an exculpation: China's successful market reforms were not predominantly the making of cautious Chinese pragmatic experimentation but ultimately originated from the insights of what the author terms “Western economists” (p. 5). Gewirtz refers to monetarists such as Milton Friedman (185 mentions), neoclassical market socialists such as Wlodimierz Brus and Ota Šik (92 and 122 mentions), and the transition orthodoxy of János Kornai (287 mentions), thus the exact same economic paradigm as the one that underpinned shock therapy. Gewirtz's aim is to “undermine the CCP's portrayal of the reforms as a largely internal process” or as “grown out of the soil of China” (p. 10). He argues instead that the “bamboo shoots [of reform] were growing in Chinese soil, but they had been grafted from plants with roots beyond China's shores,” i.e. in “Western economics” (p. 171). Gewirtz's argument thus serves both to save the face of mainstream economics and to reaffirm the imperative of Westernization.
Is Gewirtz's claim that the making of global China was mainly the result of the partnership between “Western” economists and Chinese reformers substantiated in the book? The present reviewer must answer this largely in the negative. What Gewirtz establishes is that there was a rapid intensification of exchanges between Chinese intellectuals and reform officials with the American and European economics profession starting in the late 1970s. Based on rich source material, Gewirtz also demonstrates that one particular group of reform economists, namely Wu Jinglian and his collaborators and protégés, entered into a close partnership with “Westerners.” However, Gewirtz fails to give serious consideration to the broad spectrum of economists dedicated to reform who competed over different visions and methods. By neglecting this crucial context, his claim that his specific group of Chinese economists and their “Western” partners were in fact the architects of China's reform does not convince.
Crucially, Gewirtz is largely silent on the central role of the young generation of economists working collectively at the Rural Development Research Group (nongfazu), at the System Reform Institute (tigaisuo), the Rural Development Institute (nongfasuo) and other influential research institutes. Wu Jinglian is mentioned 301 times in the book's 389 pages and is the most discussed economist by a wide margin. By contrast key figures like Wang Xiaoqiang, who is widely considered in China one of the originators of market reforms in the 1980s, is not mentioned once throughout the whole book; many other influential economists also remain unconsidered. (For more on these figures, see my forthcoming book Reassessing China's Reform Debate (1978–1988): Price Regulation and Market Creation.)
Instead of unpacking the various visions for economic reform and the real challenges of how to introduce markets into a command economy, Gewirtz focuses on the confrontation between the Chinese partners of “Western economists” and what he calls the “conservatives” (e.g. pp. 9, 11, 31) or “ideologues” (pp. 11, 76, 169). The category of conservatism here remains undefined and obscures the role of key figures like Chen Yun, Deng Liqun or Hu Qiaomu, who were critical in providing the foundations of reform, especially in the early days. Ideology is defined by Gewirtz as “a system of beliefs people hold to motivate political action” (p. 282). In this definition, “Western economics” could well be understood as an ideology if we take the axiomatic approach as starting from “a system of beliefs” and think that economics “motivate[s] political action.” Staging an opposition of ideologues and conservatives with reformers informed by supposedly value-free “Western economics” remains therefore empty in theoretical terms and vague as an empirical approach to categories.
To establish his claim that exchanges with “Western economists” shaped China's reform path, Gewirtz argues that China's reforms of the 1990s essentially followed Zhao Ziyang's agenda of the 1980s (e.g. p. 258). By largely relying on Wu Jinglian and his allies as the representatives of reform economists in the 1980s, it appears as if Zhao was fully in favour of their vision of “package reform.” But in fact, Zhao Ziyang was torn between this group and a vision for gradual dual-track reform that grew out of the agricultural reforms and was articulated based on intensive empirical research in China and Eastern Europe as well as theoretical innovations by young economists supported by old cadres like Deng Liqun and Du Runsheng. The 1980s reform debate was structured around those two poles and Zhao was swinging back and forth but ultimately remained closer to the young economists whom he had elevated to the highest levels of political influence. So when Zhao fell in 1989, most of these young economists fell with him, migrated to the West, went to prison or escaped into doing business. Wu Jinglian and his collaborators, in contrast, sailed through the turmoil of 1989 relatively unharmed. This in itself is revealing in terms of the proximity between the two groups of reform economists and Zhao. The young scholars who had to flee from the centres of Chinese economic research and policy making have subsequently been unable to publicize their contributions to the 1980s reform debate. Wu Jinglian has received ample attention before Gewirtz's book, and Gewirtz's contribution is to lift the story of Wu and his allies from the memoir literature (e.g. Wu Jinglian and Ma Guochuan's 2016 book, Whither China? Restarting the Reform Agenda, Oxford University Press) into the realm of historical research. Unfortunately, the strong bias towards one group of Western-oriented reform economists undermines the project of providing a broad analysis of the Chinese debate over the transformation of the state-market relations in the 1980s.
Gewirtz focuses on the contributions of Eastern European émigré economists invited by the World Bank, in particular on Kornai and his role at the 1985 Bashan Conference. Based on an interview with Kornai, Gewirtz argues that “the advice that Kornai offered at the Bashan Conference differed in subtle but significant ways from the views for which he was widely known around the world” such as his advocacy of “rapid liberalization or ‘shock therapy’” (p. 149). This seems, however, inconsistent with the reports about the Bashan conference published by the China Research Society on Economic System Reform [CRSESR] in 1986, which Gewirtz quotes elsewhere (e.g. p. 331). There we read that Kornai argued at the Bashan Conference: “it would be necessary to adopt the mode of ‘all-out’ reform at once” for some areas of reform (Liu Guoguang et al., 1987, “Economic reform and macroeconomic management: commentaries on the International Conference on Macroeconomic Management.” Chinese Economic Studies, 20[3], p. 14), first and foremost the abolishment of mandatory planning combined with price and wage reform, while others such as ownership reform would require a step-by-step approach (see Liu et al., 1985, “Economic system reform and macroeconomic management: a commentary on the ‘International Conference on Macroeconomic Management’ [Jingji tizhigaige yu hongguan jingji guanli: ‘hongguan jingji guanli guoji taolunhui’ pingshu]” Jingji Yanjiu, 12, p. 7; Guo Shuqing and Zhao Renwei, 1986, “Target model and transition measures [Mubiao moshi he guodu buzou]” CRSESR, ed., Macroeconomic Management and Reform: Selected Speeches of the Macroeconomic Management Symposium, Beijing: Economic Daily Press, p. 21). Hence, Kornai's advice at the Bashan Conference is consistent with his internationally known shock therapy formula which partitions reform measures along the same lines (e.g. The Road to a Free Economy 1990, W.W. Norton, pp. 13, 80, 102). This is just one albeit important example of how Gewirtz's argument is based upon a selective representation of the historical record.
Gewirtz shows convincingly that Kornai was one of the key sources of inspiration for Wu Jinglian and like-minded Chinese economists. Wu and his allies argued for “package reform” prepared by austerity with all-out price and wage liberalization at its core. As is well known China escaped such a shock treatment. Alec Cairncross noted in his 1985 diary (held at the University of Glasgow Archive) on the Bashan Conference that Kornai promoted a “constant assumption that all State intervention in economic affairs, and especially pricing, was for the bad and to be suppressed.” In contrast, the Chinese state continues to pursue an interventionist policy all the way into the present. This is key to the ongoing tensions between China, the US and the EU over further opening and reform which Gewirtz places centre-stage in the framing of his book (e.g. pp. 10–13, 268–277).
In sum, Unlikely Partners is an important contribution in opening the long overdue scholarly analysis of the intellectual foundations of China's economic reforms. It shows, based on rich sources, that one faction of Chinese reform economists was in close partnership with “Western economics.” But the book does not convincingly demonstrate that this strand of reform economics “made global China.” A comprehensive understanding of how the interaction between different groups of reform economists, their international collaborations and reform policymaking evolved requires an in-depth study of the competing reform paradigms. Gewirtz has provided just one starting point with his detailed portrayal of a particular group and their “Western” partners.
