Hastings Business Law Journal


The following Article studies China as a possible test case for a country that has attempted to win economically developed nation status without an advanced rule of law. While China has managed to grow rapidly over the past thirty years, the author warns of the risk to an economy that rests on an unstable rule of law. In Part I, the author presents an introduction and then proceeds in Part II to explain the concept of "political economy" as a field informing the study of institutions, and of norms, which constitute the background to economic development. Part III chronicles the growth of the Chinese economy over the past thirty years. Part IV discusses how revised economic metrics found that China's economic growth may be dramatically exaggerated by previous measurements. Part V compares China's historic economic growth to those economic expansions of its Asian counterparts. Part VI explains the recent influx of foreign investment into China on the promise of unbridled growth, and suggests what kinds of improvements to the rule of law might be needed to support such growth. Part VII warns of the importance of China's development in 2010, while Part VIII offers a review of the economic downturn of October 2008.