Economic Growth and Policy Dynamics in Contemporary China: A Comprehensive Analysis and Future Outlook

Abstract

The Chinese economy has grown dramatically over the past few decades. China's economic rise is particularly intriguing because it defies conventional economic models and has been driven by unique policies and dynamics. Nevertheless, in a world characterized by increasing protectionism, international trade tensions, and changes in investor sentiment, the sustainability of China's economic growth model has come into question. Chinese policymakers should navigate these shifts as investors reconsider their positions and countries protect their domestic industries. This paper investigates the policy dynamics that have contributed to the rapid economic growth in China. It also describes the various economic models that can describe the Chinese economic model. The paper reveals s that consumption, investments, and exports are the major drivers of economic growth in China. Consumption in retail sales is robust and is projected to keep increasing yearly into the future. Keynesian theory asserts that aggregate demand is the most important driving force in an economy. As such, the aggregate demand for consumer goods by government, businesses, and households is high in China. Investments are also a major driver in creating gross fixed capital. Investments from a neoclassical perspective show that investors are concerned with maximizing The conclusion shows that in a world where countries are increasingly protective of domestic industries and also where investors are withdrawing from China, policymakers will have to focus on internal growth and consumption as the driver of economic growth.