[CEAMeS DP08] – “How severe will the growth slowdown in China caused by structural change be? – An evaluation based on experiences from Japan and South Korea”

CEAMeS Discussion Paper No 8 | 2017

Michael Murach and Helmut Wagner

preliminary version of an article published in:
Journal of Chinese Economic and Business Studies 15 (3), pp. 269-287, on 12 Jul 2017.

China has been growing at high rates during the previous three decades. The current process of rebalancing from an investment- and manufacturing-led growth model towards a consumptionand service-led model is associated with decreasing growth rates. We show that China’s current state of structural change in terms of sectoral employment shares is similar to the historical
developments in Japan and South Korea. We derive plausible scenarios for future growth rates in China and (by isolating the allocation effect, i.e. the pure effect of structural change) look at the effects of tertiarization on economic growth in China for the period 2016 until 2030 by applying a simple simulation study.

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