how is India, equally populated country to China, is nowhere near the economy level China (EVERYTHING is made in here) has achieved with its manpower.
In: Economics
China is a planned economy, or at least has been for much of its recent history. These are commonly said to be weak and inefficient. However, one thing they are quite good at is achieving a particular economic goal, because they can marshal all of their labor and capital resources towards achieving it. China wanted to be an industrial export economy, so they made a plan to accomplish that and pursued it. They funded big manufacturers and shipping ports, they organized labor into them, and they controlled their currency to make sure the products were cheap to buy. Later on, they liberalized their economy somewhat and allowed some relatively “free” economic activity to boost their productivity even further. But it all comes back to a central, national objective to become an industrial exporter, and them having the political organization and power to accomplish it through a command economy.
India, by comparison, is a much freer and less state-controlled economy. That has advantages, in that every economic actor can make their own decisions to suit themselves. But in terms of national projects, it’s much weaker.
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