- In a historic reversal of fortunes, China is overtaking the territory of the former Soviet Union in GDP per capita.
- China's rapid economic development has been driven by 'regionally decentralized authoritarianism' (RDA). But only the economy is decentralized. Political centralization, the objectives and patronage of the centre, and the centre's relative performance evaluation are essential elements of the model.
- China's model of rapid economic development is best understood in a comparative context, but it is important to get the comparison right. It has been said that China's advantage over the Soviet Union was that it carried out economic reforms while postponing political reforms. In reality, this is not true. The Soviet Union made reforms similar to China's, but without the same success.
- China's success so far owes much to its unique circumstances: the great opportunities of initial poverty, exceptional economic size, and the commitment of its leaders, supported by long-standing traditions of RDA.
- In future, sustained economic development requires continuous policy reform. While China's existing model has encouraged this in the past, it is likely that obstacles will accumulate in the years ahead.
- Current risks to the continuation of China's economic modernization include two traps: complacency and conflict. These risks may become increasingly difficult to manage without strengthening the rule of law and enforcing governmental accountability.
This paper is part of the project on
Shifting Competitive Advantage in the Global Economy. 
