China: economic liberalization without political liberalization?

Joan ELBAZ (2016), McGill University, Bachelor of Arts, Honors in Political Science. 

Why has China’s economic liberalization not led to political democratization? In my paper, I hypothesize that China’s unique social, historical, cultural and economic legacies have been the main obstacles to democratization. In 1978, China began to open up its economy and to move towards open markets and more international trade with Deng Xiaoping’s “Socialism with Chinese characteristics”. Since then, it has achieved tremendous growth, becoming one of the world’s greatest economic powers. However, with its one party state, the absence of national elections and the repression of basic liberties, China is still far from standing in the ranks of the world’s liberal democracies. With this special path of development, the case of China challenges the foundations of the modernization theory, which states that as a country develops economically, it is likely to become more democratic. This puzzle can contribute to the reassessment of the modernization theory, as China not only challenges the relationship between democratization and modernization that is traditionally agreed on, but also makes scholars re-examine the origins of democracy in our contemporary world. My research paper will focus on Mainland China with all the divisions that make it a hybrid regime, starting from 1978 with Deng’s economic reforms. I argue that there are four main causes behind the lack of democratization in China. First, there is a social argument to consider: the fragmented society is a not a real drive for political change, as it has no incentive to push for democracy. Second, democratization is not happening because of the Chinese Communist Party’s strong grip over the citizens’ perception of the regime and of the notion of democracy. Third, historical and cultural legacies constitute a barrier to democratization, such as China’s socialist past and Confucian heritage. Lastly, economic considerations constitute an obstacle, as the development of the economy and the structure of the Chinese socioeconomic landscape make a democratic transition problematic.

The relationship between economic development and democracy is one of the most studied themes in the literature about democratic transition. The early theories can be traced back to 1958 with Lipset’s piece “Some Requisites of Democracy: Economic Development and Political Development”, in which he formulates the following hypothesis “the more well-to-do a nation, the greater the chances that it will sustain democracy” (Lipset 1959, 75). He emphasizes several elements considered to be key factors in modernization, such as socio-economic equality and strong human capital. He also points to the heightened role of the middle class in being the catalyst of political change. Similarly, in Social Origins of Dictatorship and Democracy, Moore stresses the importance of the middle class in democratic transition, as he writes: “No bourgeoisie, no democracy” (Moore 1966). However, when looking at China, this case seems to go against the correlation established by these authors. Indeed, the country’s economic growth has been tremendous, averaging at 9.88% from 1989 to 2015, and its middle class has greatly expanded, becoming the biggest in the world and growing faster than the United States’, according to the National Bureau of Statistics of China. Despite this, China is still an authoritarian state and the immediate prospects of transitioning to democracy are slim. More recently, scholars have questioned the existing literature and put into perspective the linear relationship between economic advancement of democratization. In their article from 1996 entitled “What makes democracy endure?”, Przeworski, Alvarez, Cheibub and Limongi claim that economic development makes democracies last longer but does not make them more likely to emerge. In others words, once a democracy has been established, it is less likely to fall back to authoritarian rule after a country has passed a certain threshold of wealth. In their model, democracy is thus an exogenous variable, as it does not seem to be explained by the level of economic development. As a matter of fact, Przeworski and Limongi argue in “Modernization: Theories and Facts” that, at a certain threshold of $6000 per capita (in 1985 U.S. dollars), “dictatorships become more stable as countries become more affluent” (Przeworski and Limongi 1997). These arguments thus demonstrate that the apparent correlation between economic development and democratization is more complicated than it seems, especially in a country with a specific social, historical, cultural and economic legacy like China.

The first type of arguments explaining the lack of democratization in China relates to the complex nature of the Chinese society. There is no serious challenge to the rule of the Communist Party because the middle class, which represented 68% of the population in 2012, is not a driving force for democratization (Barton, Chen, Jin 2013). Also, the conflicting interests within the population demonstrate that Chinese society has become increasingly fragmented, making it difficult for a democratic system to be implemented.

The main argument that Chen and Lu raise in “Democratization and the Middle Class in China: The Middle Class Attitudes Toward Democracy” is that the middle class has no real incentive to push for democracy. Their article explains the distinction between the “unilinear” and the “contingent” approaches that are found in the literature about the middle class’ tie with democracy. On the one hand, the “unilinear” approach builds on the modernization theory by stating that there is a positive relationship between a richer middle class and democratization. This implies that the “rising middle class [represents] the main thrust of the democratization movement” (Hattori, Funatsu and Torii, 2003, 129-130). On the other hand, the “contingent” approach assumes the relationship between those two variables is much more complex and dynamic. This approach states that the attitude of the middle class towards democracy depends on several factors: its degree of dependence on the state, its perceived socio-economic level, its political alliance with other classes, its class cohesiveness and its fear of political unrest. Unlike the unilinear approach, the contingent one has been supported by findings from studies of the middle class in many developing countries, including China. This suggests that the Chinese middle class’ relationship with democracy depends on several political and socio-economic factors. The results of Chen and Lu’s study show that while members of the Chinese middle class want to secure their individual liberties, they are neither likely to fight for their political rights, such as freedom of expression and association, nor for democratic institutions with competitive elections of political leaders. This can be explained by the fact that the middle class is quite dependent on the state, as the latter has the right to intervene in any part of the socioeconomic sphere and gives them certain advantages they would otherwise not benefit from. Indeed, as Bellin demonstrates in Stalled Democracy, if the state adopts a strategy “that gives unions financial and organizational support in exchange for political loyalty and self-restraint”, workers tend not to rebel against the existing regime by “fear [of] biting the hand that feeds it” (Bellin, 2011). Also, most of the members of this class appear to be satisfied with their socioeconomic level and with the public goods provided by the State, such as primary education and public transportation, and are thus not committed to making political change happen. Consequently, as long as the ruling elite ensures social stability and continues to deliver economic growth and employment opportunities to the growing middle class, the current political status quo is not likely to change much.

Building on this argument, Unger also emphasizes the lack of mobilization of the middle class as a crucial factor underpinning the absence of democratization in China. According to his article “China’s Conservative Middle Class”, many university students and members of the middle class did not necessarily fight for multiparty elections at Tiananmen in 1989. Instead, they wanted the government not to interfere with their personal freedom, asked for less censorship of the media and demanded the liberty to have intellectual discussions in public. Also, a part of the educated middle class is quite elitist and does not want rural dwellers to play an important role in decision-making, which is ironic considering they are the only ones who are able to vote in local elections. Even writers who have expressed concern about corruption or crushing poverty do so by fear that it might lead to social and political instability rather than to oppose the leadership and actually change the status quo. As Unger writes, “The Chinese educated middle class has become a bulwark of the current regime”, suggesting that it fortifies the leadership rather than challenges it, which explains why democratization has not yet happened and is not bound to happen anytime soon (Unger, 2006, 31).

This assessment of the middle class’ relatively indifferent behaviour concerning democratization demonstrates that there is a deeper issue within the Chinese society. In “Democratization and Economic Reform in China”, Gordon White explains that since the second half of the 1980s, the population has become more fragmented and conflictual, which makes it difficult for democratic institutions to develop. Indeed, the rural-urban divide has reinforced itself with the increase in the industrialization and urbanization rates. Unlike rural dwellers, urban citizens do not have strong incentives to push for democratization, as they partly owe their money and career to the party-state. Furthermore, the process of class differentiation has been accentuated and intra-regional discrepancies have expanded, making it difficult for any democratic structure to be implemented especially a multi-party system, which would crystallize social conflicts rather than alleviate them. The fragmented society being an obstacle for democracy is also an argument that Kerry Brown raises in his work Ballot Box China: Grassroots Democracy in the Final Major One-Party State. China has undergone vast economic modernization since the end of the 1970s, opening up its borders to investors and becoming one of the world’s largest economic actors. These changes have had a confounding effect on society and have translated themselves into an explosion in cases of civil unrest. According to Brown, there were 12 million petitions to the central government between 2004 and 2008 because of the way local officials dealt with tax issues, land rights and compensation for accidents. Furthermore, there has been a dramatic rise in the cases of mass unrest: this number went from 32 000 in 1999 to 58 000 in 2003 and eventually to 90 000 per year between 2007 and 2009. This increase in civil turmoil comes at the same time as the advertisement of the vision of a “harmonious society” by President Hu and Premier Wen, which expresses the leadership’s commitment to address the pressing issues of social inequality and civil instability. The absence of a strong consensus within the different parts of the Chinese population thus partly explains why democratization has not yet happened in China. Nonetheless, as Lum suggests in Problems of Democratization in China, even though there might have been an outburst in cases of civil unrest, they “have not reached levels of crisis” (Lum, 2000, 165-66). Consequently, the degree of social turmoil is not high enough to cause the expected “leadership cleavages” (Lum, 2000, 165) that could potentially result in a division between “hardliners” and “softliners” and eventually in political democratization.

Another key reason that explains the delay in democratization is that the Chinese population holds a specific view of the notion of democracy, which has largely been shaped by the Chinese Communist Party’s ability to reform itself and to convince citizens of its political legitimacy.

The Chinese population is not expressing a pressing need for further democratization because of its own perception of what democracy entails. In “China: Democratic Values Supporting an Authoritarian System”, Shi justifies the high level of support enjoyed by the party state by the fact that the Chinese seem to view democracy through their very own frame of reference. “Democracy” is a complex and multidimensional notion that does not have the same definition everywhere in the world. Although Western-style liberal democracies need to validate a certain number of criteria to be considered as such, the Chinese path is too specific to be able to answer to a Western standard of democracy. As a result, a paternalistic state with no competitive elections, such as the Chinese state, can be consistent with the Chinese population’s definition of democracy, especially since the current regime offers an increased level of freedom compared to the Mao era. This suggests that the perceived level of democratic development may be of greater importance than the actual level of democratic development in shaping the evolution of the political system. In Democracy and the Rule of Law in China, a work that gathers the viewpoints of twelve contemporary Chinese scholars, Yu puts the emphasis on the fact that China must follow a distinct path of political development, as its specificities make the establishment of a liberal democracy as we know it in the West impossible. Deng Xiaoping’s theory of democracy marks a strong shift from Mao’s, as he presents democracy, not “as a mere instrument” to meet “economic ends” (Yu 2010, 5), but as an end in itself. Deng believed that democracy was “one of the fundamental goals of China’s political reform”, but that China should not adopt Western democracy, because “the multiparty representative system and the checks and balances” of the different branches of government “constituted a democratic monopoly of the capitalist class” (Yu 2010, 8). Conversely, Chinese democracy should be established under nothing else but the leadership of the CPC. According to Kerry Brown in Ballot Box China: Grassroots Democracy in the Final Major One-Party State, the regime refuses to talk about Western styles of government, because its leaders believe that Western political values such as ideological pluralism would create great instability and would be dangerous to China’s unique social and political system. It can therefore be concluded that democracy is not a “taboo word” in China, but that it simply does not have the same significance and implications as in the West (Brown 2011, 30).

The population’s overall support for the regime also stems from the fact that it has managed to reform itself, in order to reinforce its legitimacy in the eyes of the population. According to Andrew Nathan, China’s modern political system is characterized by “authoritarian resilience”. In his article that bears the same name published in the Journal of Democracy, he explains how the party-state has managed to strengthen its authoritarian character rather than “fall to democratization’s ‘third wave’” (Nathan, 2003, 6). He points out several features that made the regime survive by moving closer to the model of the modern state: it has abandoned the image of the charismatic leader, has given power to a technocratic elite, has developed a more complex bureaucratic organization and has diminished its grip on citizens’ private sphere. In addition to this, the state has made changes that allowed the population to feel more included in the policy-making process. Indeed, elections at the local village level have been established, citizens gained the right to sue government agencies, special offices have been created to receive citizen complaints and mass media have grown more independent. By limiting the expression of grievances to the local level, these reforms allow people to voice their discontent without seriously threatening the regime as whole. All in all, this reinforces the regime’s legitimacy in the eyes of the bulk of the population and thus strengthens the authoritarian status quo.

Similarly, in “Populist Authoritarianism: The Future of the Chinese Communist Party”, Bruce Dickson explains how the CCP has adapted itself to the new social challenges it faced in the past decades. The reforms it has undertaken include efforts to represent individuals and groups that directly benefit from the economic reforms. This is particularly important, as it flows from Jiang Zemin’s socio-political theory of the “Three Represents” stating that the CCP should be invested in the inclusion of “advanced productive forces” like entrepreneurs, high-tech specialists and other new urban elites into its leadership (Jiang, 2000). According to Dickson, this is conveyed in the fact that entrepreneurs often run in village elections or local people’s congresses and are sometimes appointed in higher levels of government. This argument is further developed in his work entitled “Red Capitalists in China – The Party, Private Entrepreneurs and Prospects for Political Change”. He analyses the relationship between the Chinese Communist Party and private entrepreneurs, and how it serves as an impediment to the process of democratization. According to his findings, entrepreneurs’ interests are closely linked to those of the regime, since political connections give more access to private markets. Also, entrepreneurs usually refrain from opposing the party-state, due to the weakness of the rule of law and the absence of a systematic protection of basic rights. In his survey of 524 entrepreneurs and 230 local officials, Dickson has found that “the state […] has created the institutional means for linking itself with private business interests” and thus, “China’s entrepreneurs are not yet seeking an autonomous status with which they can challenge the state” (Dickson, 2003, 84-85). Consequently, the lack of incentive of important socioeconomic actors to create political change is a crucial element in understanding the absence of democratic transition in China. Moreover, there is no serious alternative to the current regime because of the CCP’s consistent efforts to prevent the creation of credible opposition parties like the China Democracy Party. Also, organisations like “labor unions, Christian churches, Falungong practitioners, and advocates of free speech and freedom of the press” that try to gain independence from the State are monitored and punished.

Not only has the regime managed to shape its very own definition of “democracy” and to make the necessary reforms to become more legitimate, it has also been able to convince citizens’ that it is performing better politically and economically than the previous regime. Indeed, after having asked survey participants to rate “nine major government performance domain”, Shi’s results, in “China: Democratic Values Supporting an Authoritarian System”, demonstrate that there is an overall consensus in the population that “democratic performance” has improved since Deng’s reforms (Shi, 2008, 221). Specifically, the biggest advancements were seen in freedom of expression, freedom of association and judicial independence. Furthermore, his findings show that Chinese people tend to trust their government more compared to citizens in Asian democracies, which could also explain why they tend to cooperate and not push for democratic change. There are especially high levels of trust in the national government, the National People’s Congress, the Chinese Communist Party and the People’s Liberation Army, which can be justified by the fact that the regime has strict control over certain information. Even though pro-democratic attitudes are certainly on the rise, these create strong support for the current status quo instead of a push for political change, as long as the regime keeps aligning itself with the population’s perception of what democracy is.

The absence of democratization in China can also be related to the country’s historical and cultural heritage, which is to a certain extent an impediment to further political liberalization.

In “Democratization and Economic Reform in China”, Gordon White emphasizes this argument as being one of the foremost reasons behind the lack of democratization in China. Indeed, unlike former communist Eastern European states, China has no experience of a democratically led political system. The author mentions the case of two countries to solidify the validity of his point: Hungary and the Czech Republic. These states have transitioned more easily to a multi-party democracy because the democratic traditions of the pre-World War II era had not disappeared. This not being the case in China, a transition to democracy is more difficult, although this argument does not entail that it will never occur, especially since the Chinese society has higher levels of urbanization and education than in the past. White also attracts the reader’s attention to the fact that Chinese values are not necessarily compatible with democracy. Indeed, the tradition of authoritarianism and of strict obedience to sources of authority is almost inherent to China’s Confucian culture, which goes against the decentralized and participatory notions that are proper to democracy. In Problems of Democratization in China, Lum also argues that Chinese Confucianism favours centralisation and social harmony, which do not go hand in hand with further democratization. However, one must be aware of the limits of cultural deterministic theories, since they do not account for a change in attitudes within the population. This shift in behaviour can be more accurately unveiled through survey analysis, which shows that although pro-democracy behaviour is rising in the cities and among the young, political efficacy and toleration are still low among the masses and the elites. This is what Shi demonstrates in his survey, as he analyses the population’s commitment to democracy. A majority of respondents favoured democracy, stating however that this form of political system was not “desirable now” (Shi, 2008, 232). Moreover, the majority of people who answered claimed that they gave priority to economic development over democracy. This point is also raised by Lum, when he argues that many Chinese people see economic growth and democratic structures as being incompatible and thus tend to favour the former for their personal interest. Although Shi found that most of the population was, overall, committed to democracy, China still had the highest rate of opposition to democracy out of all the countries under study, suggesting that there is strong political polarization in the country and that the penetration of a real democratic culture has not been entirely successful in the country.

The absence of a democratic structure in China could also be explained by the fact that the country is a late industrializer, this having consequences on the possibility of democratization. According to Teresa Wright in Accepting Authoritarianism – State-Society Relations in China’s Reform Era, countries experiencing late industrialization face certain challenges stemming from the international environment that countries from the first wave of industrialization did not previously face. Indeed, because the world has become more competitive, private entrepreneurs are more dependent on the state, which does not encourage them to oppose the existing regime. Also, Bellin argues in Stalled Democracy that for late industrializers, an increase in national wealth is often coupled with a rise in socioeconomic inequalities and poverty. If workers had the right to vote, they would certainly ask for better working conditions and higher salaries, which would reduce the interests of capital. This historical argument is thus an important reason why private entrepreneurs would oppose the establishment of a democratic government. Moreover, Wright emphasizes the fact that the socialist legacy in China is an important feature when trying to understand the overall disinterest for democracy. Being a post-socialist state, the process of capitalist development is more complicated than for late industrializers with no communist past. According to the author, the socialist heritage in China has had a significant impact on the population’s view of democracy, just like in other post-communist states like in Russia, or Eastern and Central Europe. Indeed, studies of the political transition of these countries show that there is an overall low level of support for democracy among the citizens and that a non-negligible part of the population believes that more economic and political liberalization would not be the answer to all of society’s hardships.

In addition, almost all of China’s socioeconomic sectors have ideological reasons to support the existing regime. According to Wright, the reason for this is that the experience of Maoist rule has, to a great extent, shaped citizens’ beliefs and values about what is morally right and legitimate. Indeed, citizens in the lower ranks of the socioeconomic hierarchy have embraced socialist values like “the right to work […] and to decent pay, accommodations and benefits” (Wright, 2010, 34). For citizens at the top of the hierarchy, the CCP’s embrace of entrepreneurs and intellectuals in the post-Mao era has made the current regime appear more open and tolerant in the eyes of the public. This has thus provided disincentives to oppose the existing government and to see democracy as economically and morally desirable.

Finally, economic arguments could explain the absence of a push towards democratization in China. The absence of an independent private business class and the non-negligible levels of poverty and inequality make political liberalization undesirable if not unfeasible.

Unlike other states in East Asia that have experienced significant political change in the 1970s and 1980s, China’s rapid economic growth has not led to the establishment of a democratic government. In “Reform and Openness: Why China’s Economic Reforms Have Delayed Democracy”, the reasons behind this “Chinese exceptionalism” are explained (Gallagher, 2002, 339). According to her, “the timing and sequencing of [China’s] Foreign Direct Investment liberalization” have played a crucial role in the reform of the economy without abandoning the authoritarian structure of the regime (Gallagher, 2002, 339). She argues that China’s experience is very different from to that of other East Asia states, especially Korea, Japan and Taiwan. In these states, FDI was maintained quite low, foreign intervention in the economy was not significant and the private sector was strong. The Korean and Taiwanese private business classes grew particularly powerful and independent with time, which made the combination of an authoritarian government and a capitalist economy unsustainable. As a result of the cleavage between the business class and the state, pressure for change started to emerge and there was a rise in support for democratization movements. On the contrary, China has taken a very different path of development: it has liberalized FDI over the last few decades and has not well developed its private sector economy, the latter being still dependent on the support of local level government. As a matter of fact, FDI is considered to be “the substitute for domestic private industry in China” (Gallagher, 2002, 368), which thus makes it unlikely for the private sector to play a key role in the push for democracy. More specifically, the liberalization of FDI has delayed political transition because it came before key reforms needed to complete this transition, namely the privatization of the state sector and the expansion of a capitalist class. Although the expansion of FDI could indirectly provide the basis for a potential democratic system, the absence of an independent private business class has not encouraged political liberalization despite the economic reforms that were pursued.

Moreover, in “Democratization and Economic Reform in China”, Gordon White argues that the establishment of a substantive form of democracy, with a high degree of representation, is hard to reach in a society in which a non-negligible part of the population lacks the material wealth, the knowhow and the energy to be civil actors engaged in the political process. Indeed, playing a meaningful and active role in civil society implies that one has attained a certain level of material security to be able to freely focus oneself on other considerations such as political participation. However, poverty is still a key issue in Chinese society that has increasingly been addressed by the government, especially in poor urban areas where people are economically and socially marginalized. According to official studies, the number of urban poor went from 12 million in 1993 to 22 million in 2006 (Hussain 2003). Besides, a quick shift to democracy would exacerbate the already existing socioeconomic inequalities, as the power would be concentrated in the hands of a small elite, while the bulk of the population would be left out of the political process. The rapid economic growth of the last decades indeed came alongside a strong rise in inequality as a big part of the population remains poor and isolated from the successes of the market economy. China’s National Bureau of Statistics estimated in 2009 that urban dwellers’ per capita income was three times as high as that of their rural counterparts, which is the highest income gap recorded since 1978 (Fu 2010). All in all, political liberalization would be difficult for poor citizens to participate in, and would contribute to the worsening of inequality in the country, which partly explains why further democratization has not yet occurred.

To conclude, China’s absence of democracy despite its economic liberalization can be explained by four main factors. First, the middle class is not a driving force for democratization and the fragmented nature of the Chinese society makes it difficult for democratic institutions to be established. Second, the Chinese Communist Party has managed to make the necessary reforms to be seen as legitimate in the eyes of the bulk of the population. Third, the socialist historical past and Confucian cultural legacy of the country are not necessarily conducive to democracy. Lastly, there are economic barriers to democratization, namely the lack of an independent private sector and the strong socioeconomic inequalities that would only be exacerbated with a shift in the political system. All of this demonstrates that China indeed does not follow the classic path of development dictated by the modernization theory, according to which political democratization should follow economic liberalization, because of its unique social, historical, cultural and economic legacies and structure. The Chinese Constitution of 1982 perhaps best summarizes the issue at work: no common political model exists that is suitable for every nation in the world and the political structure, as it is today, fits China’s particular characteristics. Therefore, if economic development does not inevitably lead to political liberalization, this encourages us to question what elements are conducive to democracy. China’s case is thus of crucial importance in the light of the reassessment of the modernization theory. While Western nations might follow the stages of development outlined by Rostow in The Stages of Economic Growth, this theory might be inapplicable to countries like China, that do not seek to adopt the liberal democratic values that modernization theorists had predicted they would embrace.


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