The Third Type of Inter-System Competition: Europe and the Rise of China
China’s economy continues to grow apace, creating a worrying new form of economic and political competition for Europe and the US. While private entrepreneurship and free pricing play a growing role in China, the state continues to control economic developments in many sectors and owns almost all of the banking system. Is Chinese state capitalism about to outperform market economies in science and technology? Will its role in developing and emerging economies reduce the influence of the West?
Clemens Fuest, president of the ifo Institute and director of the Center for Economic Studies at the University of Munich, examines Europe’s ability to compete with this third type of inter-system competition.