HONG KONG ¨C In 1944, Friedrich A. Hayek suggested that the spontaneous order of markets was inherently superior to the supposedly dynamism-draining totalitarian order of communist or fascist regimes. The ensuing decades ¡ª when free-market economies thrived and the Soviet Union¡¯s centrally planned economy imploded ¡ª seemed to vindicate him. Then along came China.
The metrics of China¡¯s phenomenal economic rise are well known: three decades of double-digit GDP growth; some 700 million people lifted out of poverty; an infrastructure boom; the emergence of innovative tech giants and a comprehensive blueprint for continued (sustainable) growth and development.
China¡¯s success has eroded the belief that free markets represent the best development strategy for everyone, to the point that even the International Monetary Fund ¡ª long a leading champion of free-market ideology ¡ª has been rethinking its own orthodoxy. Yet Chinese-style central planning is still viewed with disdain in the West, where observers disparage it for its supposed opacity and repressiveness.
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