Spatial disparities of adaptation to crisis in China and its consequences

Spatial disparities of adaptation to crisis in

China and its consequences

Maria CsanádiInstitute of Economics

Hungarian Academy of Sciences

Outline Hypothesis: impact of external dynamics on

system transformation Analytical approach: the concept of transformation Adaptation pressures caused by the crisis Sensitivity to adaptation pressures Spatial impacts of the crisis Spatial disparities in efforts to overcome the crisis Long-term spatial impact of short-term

interventions

Hypothesis: sensitivity to the impact of global dynamics Global growth, economic integration

Direct impact: macroeconomic growth Indirect impact:

Acceleration of economic transformation Increase of political legitimacy Postponement of preconditions for political

transformation Global recession, economic integration

Direct impact: macroeconomic decline Indirect impact:

Slow-down of economic transformation Decline of political legitimacy Formation of preconditions for political

transformation

System transformation in party-states

The party-state network is retreating as a social system from politically monopolized economic, political and social sub-spheres, while

The sub-spheres of a new social system are emerging outside of it Order, speed, conditions of transformation of sub-fields vary

according to the distribution of power in party-state networks Directions and speed of development of one subfield may change

temporary or for longer-term due to external and internal impacts

Retreatingparty-state

network

Emerging new system

Transformation during global growth

External impact: decline of export- and import growth

Decline of the GDP and FDI growth

No contraction, only slow-down of relative speed

Uncertainties Time-span of prevalence of external and

internal adaptation pressures Sensitivity of the transformation process to

adaptation pressures and to their extension in time

Extent of political sensitivity and adaptive reactions on the short term

Reversibility of the slow-down process due to changes in external and internal impacts

Spatial propagation of adaptation pressures and reactions

Adaptation pressures prevailed short-term

Source: ChinaData Center MU

Even short-term pressures provoqued sensitive reactions


Behind the scene: expanding state role through the stimulus plan4,000,000,000,000.00 CNY

= 612,062,609,166.63 USD

= GDP 13% (2008)

Source: Economic observer On-line eeo.com.cn China's Stimulus Package: A Breakdown of Spending. 2009.03.07

Compensatory role of state intervention: infrastructure building


Spatial focus of increased FDI


Spatial focus of growth of investment in fixed assets


The dynamics of output of the state-owned field in the manufacturing

Source: ChinaData Center MU, NBS Regional Statistics

Activized market field at central-western regions in manufacturing


Dynamics of the output at state-owned field in the construction industry


Activized market: dynamics of the market field in the construction


Global crisis impact on system transformation

Time-span of external and internal adaptation pressures Global crisis exerted temporary adaptation pressures Incite different adaptations that have different consequences on

transformation Differences in impact and reactions in space

Direction of transformation dynamics: No simultaneous contraction of the state and market fields

Speed of transformation: Instead of contraction, only temporary slow-down occurred Reason of slow-down: the temporary decline of the market field and

expansion of the state-owned field due to intervention Short-term adaptation preserved political legitimacy

Mismatch of state intervention and crisis impact Mismatch Crisis direct impact Stimulus plan direct

impact

In location Coastal Central and western

Priority sectors Manufacture Infrastructural

Trade orientation Export Domestic

Participant ownership

Private State owned

Enterprize size SME Large

Affiliation Foreign Domestic

Longer term consequences of short-term intervention The focus mismatch of crisis and government

intervention has multiple dimensions and multiple consequences Regional focus of state intervention might decrease

spatial disparties of development in several dymensions

Sectoral focus of state intervention in infrastructure compensated decline in manufacturing: growth of internal demand activates other sectors and decreases export dependency

Ownership focus of state intervention expanded the state sphere but also activized the market sphere

Size focus of state intervention also activized SMEs

Questions for further research How do these consequences appear in

The spatial disparities of regional development, The economic, export and labor force structures Enterprise investment behavior, trade orientation and spatial

strategies What are the differences among those activized by state

intervention and those directly impacted by the crisis The temporary and longer-term migrant spatial routes,

migrant motivations and bargaining capacties and living conditions and migrant gender structure

Economic transformation Field-work in collaboration with BNU, Fudan, IE CASS

Thank you for your attention

Spatial disparities of adaptation to crisis in China and its consequences

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