In Restructuring the Chinese Economy, Michael Pettis outlines six paths that China can follow—the only logical paths that lead ultimately to. Avoiding the Fall: China’s Economic Restructuring. MICHAEL PETTIS. Copyright Date: Published by: Carnegie Endowment for International Peace. Avoiding the Fall has 98 ratings and 6 reviews. The days of rapid economic growth in China are over. Mounting debt and rising internal distortions mean t.

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But it could be more compacted. The book is definitely worth reading for anyone interested in looking at why China may well crash in the next few years. In light of these issues, Pettis brilliantly lays out the routes China can take while bearing in mind their limitations.

My library Help Advanced Book Search. The downside is that notwithstanding this the most benign forms of rebalancing are politically michaep and thus, in Michael Avoidnig view, unlikely to occur.

The upside is that while China pehtis slow dramatically in the rebalancing process, the shift towards consumption will partially offset that slowing and insulate the household sector. Over the long term, Chinese growth will be much healthier and the risk of a Chinese debt crisis much reduced, but over the short term, unless there is an unlikely surge in global demand, China cannot both rebalance its economy and improve its trade performance.

Beijing has no choice but to take significant steps to restructure its economy. Ayman Hindy rated it really liked it May 05, Nov 30, JG rated it liked it Shelves: It may be true that labor is cheap in China, but capital is cheaper, and can even be free or have a negative cost as a result of a negative interest rate.

Samuel Gruen rated it really liked it Aug 14, In this sense, the burden of cost can be disproportionately spread across different facets of the economy. avoidong

Jan 20, Liam rated it it was amazing. There are no discussion topics on this book yet. Joe Coffey rated it it was amazing Dec 30, Thanks for telling us about the problem.


Ask most people what China’s comparative advantage is, and they are likely to say that it is the huge pool of cheap and disciplined labor. Want to Read saving…. It’s a great book though. But overall it is an interesting, provocative and timely take on China’s economy.

Additionally, the cost of investment in one sector of the Chinese economy may bounce back to a completely unrelated sector. Some of these issues include large alterations in interest rates, wages, currency, and legal structure, with, of course, political gain of the reimbursements of growth. Pettis lives in Beijing and is a professor of finance there.

Refresh and try again. Investment is important to the extent that the capital avoidijg engineers growth, but it is not reasonable to assume that every single dollar that China spends on infrastructure or avoidig arbitrary project will do so. Will China start selling to its own people?

Avoiding the Fall: China’s Economic Restructuring

To see what your friends thought of this book, please sign up. How Beijing chooses will determine China’s position in the world for the rest of the century. They also ensure that information is disseminated quickly. And much of it makes it sound like Pettis has invented some of the more basic concepts.

What makes Pettis’s book so striking is when he puts his arguments to the test–predicting that China will pettis at a percent annual rate in the coming decade. The reader avoidinv require a basic understanding of balance of payments, but beyond that, Pettis does a fabulous job of explaining what has been going wrong with the China model of growth, and how it has been successfully michel up until now.

Ksenia Kondrashina rated it it was amazing Jun 20, The urgent task of shifting toward greater domestic consumption will come with political costs, but Beijing must increase household income and reduce its reliance on investment to avoid a fall.

Though China may benefit by peftis profits, in the end it will still be michel producer economy; it will not be an inventor economy. Some important routes include increasing interest rates to force up foreign exchange values of the currency, transferring wealth from the state to the private sector by absorbing private-sector debt, or privatizing assets to increase household sector wealth.


This is just arithmetic. Apr 21, Myoungseok Jeong rated it really liked it. In the future, the availability of capital, or lack thereof, avoidint force China to reconsider what it believes to be its most valuable economic asset.

But China’s growth is actually heavily capital-intensive. Speculators, because they trade frequently, provide the liquidity and trading volume that allows value investors and relative value traders to execute their trades cheaply.

Quotes from Avoiding the Fall In Restructuring the Chinese Economy, Michael Pettis outlines six paths that China can follow – the only logical paths that lead ultimately to rebalancing – and discusses the political and economic strengths and limitations of each.

China’s Economic Restructuring by Michael Pettis.

James Fee rated it it was amazing Mar 02, This book is already a classic for me. Luke rated it it was amazing Mar 20, In exchange, however, China’s domestic market will become a bigger source of demand as Chinese households benefit from rebalancing.

Avoiding the Fall: China’s Economic Restructuring – Michael Pettis – Google Books

Open Preview See a Problem? The days of rapid economic growth in China are over. If you have read his previous book: The only question is how to proceed. Zack Sanders rated it really liked it Nov 22, Books by Michael Pettis. He also addressed a very big confusion – why has Chinese inflation been so low in the face of growing credit and very high nominal GDP growth.