The China Puzzle: “Touching Stones to Cross the River”
China's approach toward post-Stalinist reform contrasts markedly with that of most other former centrally planned economies. Eastern Europe and Russia have tried to move rapidly towards a market economy ("one cut of the knife"), whereas, after Mao's death in 1976, China adopted an incremental reform path ("touching stones to cross the river"). Many observers considered China's program to be poorly designed. It seemed to have led to an unsatisfactory "halfway house" that was neither capitalism nor socialism an institutional framework which perpetuated bureaucratic interference in the economy and was expected, therefore, to have produced poor results. Moreover, the Tiananmen massacre in 1989 was connected closely with the tensions of economic reform. It was widely felt that this signaled the end of reform, and that China would lapse into lowgrowth authoritarianism. But China confounded the consensus of critical