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Difficulty: MediumEconomics in the Global Age

The following is an excerpt from remarks made by Deng Xiaoping, the leader of the Chinese Communist Party, during his tour of southern China in 1992:

'Whether the emphasis is on planning or on market forces is not the essential distinction between socialism and capitalism. A planned economy is not definitionally socialist, because there is planning under capitalism; a market economy is not definitionally capitalist, because there are markets under socialism. Both planning and market forces are merely economic means to develop productivity.'

Based on the passage, the economic policies advocated by Deng Xiaoping contributed most directly to which of the following developments in late twentieth-century China?

  1. A
    The revival of early modern mercantilist strategies to isolate the Chinese domestic market from foreign goods
  2. B
    The complete homogenization of Chinese culture with Western social values and political systems
  3. The rapid expansion of private enterprise and China's integration into global trade networksAnswer
  4. D
    The submission of Chinese industrial centers to direct European colonial administration

Answer

The rapid expansion of private enterprise and China's integration into global trade networks
The correct answer is correct because Deng Xiaoping's remarks during his 1992 Southern Tour provided the crucial ideological justification for incorporating market mechanisms into the Chinese economy. This led directly to the acceleration of economic reforms, the growth of private enterprise, and China's deep integration into the global capitalist trade network.

Step-by-Step Solution

1
Analyze the provided historical source.
Deng Xiaoping argues that planning and market forces are tools for developing productivity, asserting that market mechanisms are compatible with a socialist system.
Understanding the leader's argument is necessary to connect it to the corresponding historical outcomes in China.
2
Contextualize the source within late twentieth-century global economics.
This ideological shift justified the creation of Special Economic Zones (SEZs), encouraged foreign investment, and facilitated market reforms (neoliberal-style economic policies) under state supervision.
This links the intellectual justification to the concrete economic actions taken by the Chinese government.
3
Identify the direct outcome of these economic reforms.
China transitioned toward a socialist market economy, leading to rapid industrialization, private sector growth, and integration into the global capitalist trade network as a major exporter.
This matches the target historical process with the correct answer choice.

Key Concept

Economics in the Global Age
Estimated Time:1m 30s
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Topics

Economics in the Global Age

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