Transitional Economy China shifted from a Soviet style economy to a market-style economy. Why is China different? more gradual, via family outlets no simultaneous political transition began at a lower-level of economic development thus, China started in agriculture East Asian Development Model We see this in Singapore, HK, Japan, Korea, Taiwan, China. land to the tiller: moving land away from landlords and giving it to producers export orientation: moving from low-end products to high end export financial repression: low interest rates (promote exports + make imports more expensive + allow lending), undervalue currency, capital controls on cross-border flows Unlike Japan, etc., China had to import technology + expertise because their work is way behind; therefore they were interested in foreign direct investment Why did China/Viet do better than, say, i.e., USSR? The State didn’t collapse! …rule of law + ability to enforce private ownership \