Reflections on China's Late 19th and Early 20th-century Economy

Abstract

The basic structure of the Republican economy at its pre-1949 peak is not much in dispute.1 With a population probably in excess of 500 million, the economy was predominantly agrarian: nearly two-thirds of its GNP originated in agriculture, and probably three-quarters of its labour force derived most if not all of their living from farming. There was a small modern sector, comprising parts of manufacturing, transportation, finance and so on, that represented no more than a tenth of GNP and was largely concentrated in the treaty ports. A similar percentage of the population lived in urban areas. It was a relatively commercialized economy, with as much as 40–45 per cent of farm produce making its way primarily into domestic markets. And by most measures, it was also moderately “open.” Imports and exports combined totalled about one-eighth of GNP. It was, however, a very poor economy. Per capita GNP in the mid-1930s was only 60 yuan, which converting into current U.S. dollars is only $200–250. Purchasing power parity calculations suggest an estimate probably double or even triple this, but by today's standards, this would still rank China amongst the poorer “low-income” countries.2