advantages and disadvantages of Chinese
Answers
China follows the command economy approach, wherein the government controls everything....the west follows free market economy and in India we have a mixed type of economy...
The political system of India is multi-party democracy, however in China it is a single party rule and communism being a totalitarian system by design, the party which purports to rule on behalf of the people allows for a dictatorship...
So the political economy of India is open to different kinds of pressures unlike the Chinese one.
The command type economy has a few advantages and disadvantages...
the advantages are
1.Centralised tight planning-- hence no wastage of resources or output.
2.Monopolies in the private domain are absent.the state has a monopoly.
3.Emergency situations can be better managed due to central control on production.
4.Price is not determined by the market unlike free market economies but by govt.dictat..hence better price control...which is important in some situations.
5.Unlike private entrepreneurship which is driven by greed or selfish desire of the entreprneur or investor...the state economy managers are more altruistic...hence notionally no one person can actually gain over another...
the disadvantages are
1.since the views of the people are not always taken into account and production is based on a centralised decision making process..this can lead to excess production of some stuff and underproduction of other stuff...based on faulty data of the requirements.
2.China has witnessed large famine several times under communist rule.This is because rather than take care of the needs of the people, production has been oriented for other reasons of the state policy...In India post independence there has been no incidence of famine..on a large scale.
3.As production is centralized and may not be in tune with the specific needs of its people...there is a large thriving underground black market in China...the estimation of wealth siphoned off to foreign tax havens is much more in the case of China as compared to India.Likewise there is a huge environmental cost ...where production has been achieved at the cost of damaging the environment.
4.For decades China followed a one child policy...social fabric of society in many ways has been destroyed.....there is an enormous cost to be paid by the current Chinese population to support the social and economic needs of a very large number of aged citizens.In contrast India has a huge population of youth who can be productive for a long time.
5.Individual growth opportunites in China are not open for most.Since there is huge regulation of production...very few people except maybe for party members and their near and dear ones.Crime rate of China is also very high...even though the punishment is harsh as compared to Indian statute.
So while the growth rate of China has been impressive compared to India, the social and possible economic and environmental price has been horrendous.
I would bet in favour of India in the current century