

































Aisthesis      Volume 15,  20241

Impact of Deng Xiaoping’s Economic Reforms in China’s 
Modernization

by Kelly Wang

Introduction
 !e Century of Humiliation (1839-1949) led 
China, once a technologically developed nation, 
to fall into backwardness and poverty while other 
countries continued to industrialize.1 Rapidly 
falling behind its East Asian neighbors, Japan and 
South Korea, but also, more embarrassingly, smaller 
Southeast Asian countries like Malaysia, Singapore, 
!ailand, and Indonesia,2 China was ashamed by 
its lack of stature throughout the nineteenth and 
twentieth centuries. Mao Zedong’s authoritarian 
rule, intended to rejuvenate the nation, instead 
le" China not only in extremely poor economic 
condition, but also with horri#c memories from 
the Great Leap Forward and the Great Proletarian 
Cultural Revolution.3 
 Upon coming to power, Deng Xiaoping was 
intent on maintaining the one-party state established 
by Mao. Acutely aware of the importance of 
political control and military support, he accurately 
concluded that “without material gain, no degree 
of coercion would ensure the Party’s survival.”4 

1 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
14. 
2 Vince Cable et al., “From Deng to Xi: Economic Reform, 
the Silk Road, and the Return of the Middle Kingdom” 
(LSE IDEAS, May 2017), https://www.lse.ac.uk/ideas/
publications/reports/deng-xi, 15. 
3 Bert Hofman, “Re$ections on 40 Years of China’s Re-
forms,” In China’s 40 Years of Reform and Development: 
1978–2018, edited by Ross Garnaut, Ligang Song, and Cai 
Fang, pp. 53–66, ANU Press, 2018, http://www.jstor.org/
stable/j.ctv5cgbnk.11.
4 David Shambaugh, “Editorial Introduction: Assessing 
Deng Xiaoping’s Legacy,” !e China Quarterly, no. 135 
(1993): pp. 409-411, http://www.jstor.org/stable/654095, 
410. 

It was this understanding that compelled him to 
introduce and support market forces, opening 
China to capitalism and foreign investment. Deng’s 
successful economic reforms, li"ing millions out of 
poverty and catapulting economic growth,5 have had 
a lasting impact on Chinese society by “bringing the 
country out of isolation and into the modern world 
economy”6 as a burgeoning global superpower. 
However, in equating national income statistics like 
Gross Domestic Product (GDP) to modernization, 
Deng neglected political reform, believing it 
super$uous to development.7 
 As such, this essay evaluates: How signi"cant 
were Deng Xiaoping’s economic reforms from 1976 
to 1989 in modernizing China? by looking at the 
time period between the household responsibility 
system (1978), Deng’s #rst major economic reform, 
and the Tiananmen Massacre (1989), the climax 
of his reluctance and failure to democratize. !e 
investigation not only provides insight on the 
shortcomings of Deng’s economic reforms and 
their implications for China’s future development, 
but also evaluates the “no democratization, no 
modernization” claim of Chinese student protestors 
in 1986.8 Overall, this investigation contends whether 
economic reform alone is su%cient for a country to 
“modernize.”
 !is investigation consulted the works of experts 
on the history of modern China such as Jonathan D. 
Spence and Ezra F. Vogel, alternative perspectives on 

5 Vince Cable et al., “From Deng to Xi: Economic Reform, 
the Silk Road, and the Return of the Middle Kingdom” 
(LSE IDEAS, May 2017), https://www.lse.ac.uk/ideas/
publications/reports/deng-xi, 1. 
6 Barry Naughton, “Deng Xiaoping: !e Economist,” !e 
China Quarterly, no. 135 (1993): pp. 491-514, http://www.
jstor.org/stable/654099, 491.
7 Jonathan D. Spence, !e Search for Modern China (New 
York, NY: W. W. Norton, 1999), 746.
8 Ibid., 682.



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  20242

communism in China from Alexander V. Pantsov 
and Minxin Pei, and prominent economists like Bert 
Hofman and Clem Tisdell. Sources written during 
Deng’s rule generally provided less value because 
e&ective analysis of China’s development tends to be 
completed in retrospect. Regardless, primary sources 
like “Deng Xiaoping: !e Economist” by Barry 
Naughton and “Teaching Economics and Studying 
Economic Reform in China” by Gregory C. Chow, 
emphasize the immediate impact and con#rm the 
success of Deng’s economic reforms.
 A concrete de#nition for the abstract concept 
of “modernization” is imperative for more objective 
analysis. Cyril Black, professor and specialist in 
European history and expert in modernization theory, 
provides such a rubric, suggesting #ve dimensions to 
modernization: intellectual, social, psychological, 
economic, and political development.9 According 
to Black, it is when these #ve dimensions develop 
that a country is introduced to the modern values 
which aid in transitioning  away from traditional 
society.10 Cal Clark and Jane Sabes use Black’s model 
in their paper comparing development strategies, 
demonstrating the academic acceptance and usage 
of his model.11 
 Hence, to evaluate the research question, Deng’s 
economic reforms need to be weighed against other 
factors in China’s development to determine their 
respective signi#cance in modernizing China. 
Black’s #ve dimensions of modernization are used 
to examine two of Deng’s most prominent economic 
reforms: the household responsibility system and 
Special Economic Zones, as well as non-economic 
components of China’s modernization. !ese 
include other key proponents of development such 
as international relations, education reforms, and the 
Tiananmen Massacre. Altogether, this investigation 
argues that though Deng’s economic reforms set the 
foundations necessary for further modernization, 

9 Cyril E. Black, !e Dynamics of Modernization: Essays 
in Comparative History (New York, NY: Harper & Row, 
1966). 
10 Ibid.
11 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
13.

countless other factors played vital roles, suggesting 
that Deng’s economic reforms were only slightly 
signi#cant in modernizing China.

Household Responsibility System
 According to Jonathan D. Spence in !e Search 
for Modern China, a comprehensive explanation of 
China’s history over the last four centuries based 
on his popular course at Yale, modernization 
requires “the vigorous restoration and speeding 
up of farm production.”12 It is through developing 
China’s predominantly agricultural populace13 that 
a sturdy foundation for further development can be 
established. When Deng took control of China, the 
commune system was o%cial policy: one’s additional 
labor and corresponding additional yield would not 
belong to oneself, but rather be shared equally by all 
team members.14 It was entrepreneurial and brave 
local leaders, not Deng himself, who challenged this 
ine&ective system.
 When Wan Li was appointed as #rst party 
secretary of Anhui in June 1977, he was confronted 
with the degree of extensive starvation resulting from 
his predecessor’s adherence to Maoist principles 
in an impoverished rural province.15 Drawing 
inspiration from Deng Zihui, head of the Rural Work 
Department under Mao’s rule who advocated “giving 
production brigades more autonomy,”16 as well as his 
own experiences visiting desolate communes, Wan 
dra"ed a proposal with recommendations on how 
to address the rural problems in Anhui. Deng did 

12 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 622.
13 Bert Hofman, “Re$ections on 40 Years of China’s Re-
forms,” In China’s 40 Years of Reform and Development: 
1978–2018, edited by Ross Garnaut, Ligang Song, and Cai 
Fang, pp. 53–66, ANU Press, 2018, http://www.jstor.org/
stable/j.ctv5cgbnk.11.
14 Gregory C. Chow, “Teaching Economics and Studying 
Economic Reform in China,” China Economic Review 1, 
no. 2 (1990): pp. 193-199, https://doi.org/10.1016/1043-
951x(90)90006-a, 129.
15 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
436.
16 Jean-François Huchet, “!e Economic Legacy of Deng 
Xiaoping,” China Perspectives, no. 11 (1997): pp. 6-16, 
http://www.jstor.org/stable/24050445, 8.



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  20243

not publicly support Wan’s proposition. However, 
he did informally permit Wan to experiment with 
alternative methods of production by pragmatically 
stating “where peasants were starving, they should 
be allowed to #nd a way to survive.”17 
 Decentralizing agricultural production, the 
commune system was replaced by land distribution 
to individual households. Permitting surplus 
produced above state-imposed quotas to be sold 
at local free markets,18 peasants were no longer 
protected by their communes. Income and economic 
well-being became directly dependent on individual 
e&orts, thereby providing the incentive for e&ective 
labour. !e results were encouraging; by 1979, grain 
production in Anhui “rose by more than 27 million 
tons compared to 1978, an 8 percent increase.”19 Deng 
publicized the successful results, subconsciously 
pushing the idea of agricultural decentralization into 
the psyches of more leaders and increasing public 
support for the economic reform.20 
 Zhao Ziyang, #rst party secretary of Sichuan, 
engaged in similar policies to Wan, approving the 
division of collective land to individual households21 
and allowing additional output to be sold in private 
markets at free-market prices.22 Mirroring the 
agricultural success in Anhui, “grain production in 
Sichuan jumped 24 percent”23 from 1976 to 1979. 
 As Ezra F. Vogel describes in Deng Xiaoping 
and the Transformation of China, a Lionel Gelber 

17 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
386.
18 Gregory C. Chow, “Teaching Economics and Studying 
Economic Reform in China,” China Economic Review 1, 
no. 2 (1990): pp. 193-199, https://doi.org/10.1016/1043-
951x(90)90006-a, 129.
19 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 363. 
20 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
440.
21 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 363.
22 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 642.
23 Ibid. 642.

Prize-winning book which intends to educate 
Americans on Deng’s impact on social and economic 
developments in China, “rather than attack them he 
had waited until the results were proven; gradually 
people recognized that the new strategy was working, 
and within several years, the experiments became 
national policy.”24 Allowing a bottom-up rather than 
top-down approach to initiate change, there was 
little resistance to Deng’s o%cial pronouncement of 
the household responsibility system in 1980.
 Grain production continued to increase, 
surpassing “400 million tons [in 1984], compared 
to 300 million tons in 1977,” allowing “per capita 
grain consumption [to rise] from 1977 to 1984 from 
195 kilograms to 250 kilograms.”25 With this rising 
agricultural output, farmers’ incomes increased 
as well, doubling from 1978 to 1982.26 In 1985, the 
su%cient grain production and relatively stable 
farmer incomes allowed the government to abolish 
obligated grain purchases and grain rationing.27 
However, the rural household responsibility system 
was not without criticisms. For one, the majority 
of peasants remained poorer than their urban 
counterparts while experiencing substandard health 
care and education.28 Additionally, hundreds of 
millions of peasants moved from rural areas to 
cities, and from the north to the south, depleting 
many regions of their youth and their hopes of a 
prosperous future.29 
 Ultimately, weighing the positive and negative 
consequences of the household responsibility 
system, China received a net bene#t. !e economic 
reform provided basic nourishment to all of China 

24 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
440.
25 Ibid., 444. 
26 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 370.
27 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
444.
28 Ibid., 444-445.
29 Jacques deLisle and Avery Goldstein, To Get Rich Is 
Glorious: Challenges Facing China’s Economic Reform and 
Opening at Forty (Washington, D.C.: Brookings Institu-
tion Press, 2019), 7-8.



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  20244

by resolving the grain shortage, prevented another 
revolution by increasing the wealth of the peasants, 
and inspired social mobility through encouraging 
entrepreneurship. !us, this introduction of rural 
decentralization e&ectively began easing the public 
into accepting the market economy.
 It was courageous local leaders who promoted 
the new agricultural model and catalyzed economic 
growth rather than Deng himself. Without Wan 
Li and Zhao Ziyang, who developed the system 
“from below,” conservative bureaucrats would not 
have accepted the “radical” rural reform. Further 
examples will only continue to prove that countless 
other leaders played integral roles in modernizing 
China. !us, attributing China’s modernization 
solely to Deng lacks nuance by evoking the great 
man theory of historical analysis. !is judgement is 
not aimed to undermine Deng’s e&ective leadership: 
it was his pragmatism that authorized “crossing 
the river by feeling for the stones,” embracing and 
reworking ideas that appeared radical but would 
greatly bene#t China.30 In fact, Jean-François 
Huchet, a French economist who specializes in the 
economic development of China and president 
of Institut national des langues et civilisations 
orientales, surmises: “One could say that his 
greatest contribution to the success of collective 
rural enterprises was precisely to do nothing, or to 
refrain from setting ideological obstacles to their 
development.”31 Deng, unlike other leaders who were 
bound to ideological purity, was open to capitalistic 
methods, allowing individuals to explore the free 
market free of bureaucratic in$uences so long as 
they remained politically subservient.
 As Chinese-American economist Gregory C. 
Chow, known for his expertise in the economies 
of Taiwan, Hong Kong, and China, suggests, “!e 
success of reform in agriculture served as the 
foundation of reform in other sectors not only by 
increasing the supply of food but also by changing 
the ideological thinking of Communist Party 

30 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 382.
31 Jean-François Huchet, “!e Economic Legacy of Deng 
Xiaoping,” China Perspectives, no. 11 (1997): pp. 6-16, 
http://www.jstor.org/stable/24050445, 11.

members in support of a market economy.”32 !us, 
the household responsibility system kickstarted 
China’s modernization through introducing the 
social and economic development necessary for 
further development.

Special Economic Zones
 In 1977, attention was brought to the thousands 
of $eeing Chinese youth who escaped across the 
southern border to neighboring Hong Kong and 
Macao. Previously regarded as a security issue, with 
border patrol and detention centers established to 
control the $ow of people, Deng believed the true 
problem was simply that “Hong Kong and Macao 
were wealthy and the PRC was poor.”33 As a result, 
to prevent further exodus, the disparity of living 
standards required quick recti#cation.34 !e solution 
was Special Economic Zones (SEZs), regions in 
Guangdong province primarily regulated by the 
free market with incentives for foreign investment 
and $exible governmental measures, which were 
established on August 26, 1979.35 !e four chosen 
cities were selected for their proximity to foreign-
capital sources: Zhuhai adjacent to Macao, Shenzhen 
bordering Hong Kong, and Shantou and Xiamen 
across from Taiwan.36 
 From 1978 to 1984, the SEZs propelled exports 
to increase by 238 percent, surpassing 100 billion 
yuan.37 Seeking physical con#rmation for the 
statistical economic successes of the regions, Deng 
travelled to Guangdong in January 1984. Pleased 
with the results, he advocated for further reform 
upon returning to Beijing in February.38 At the !ird 

32 Gregory C. Chow, “Teaching Economics and Studying 
Economic Reform in China,” China Economic Review 1, 
no. 2 (1990): pp. 193-199, https://doi.org/10.1016/1043-
951x(90)90006-a, 129.
33 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 337.
34 Ibid., 337.
35 Ibid., 367.
36 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 636-637.
37 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
418.
38 Ibid., 419.



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  20245

Plenum of the 12th Party Congress in October the 
same year, fourteen new coastal Economic and 
Technological Development Zones39 and three 
development deltas40 were established with the 
intention to increase rapid economic development.
 Bringing capitalism to speci#ed regions and 
opening the country to the global economy led to 
tremendous economic growth. !e favorable tax 
rates encouraged foreign direct investment (FDI), 
which increased from “an annual rate of less than 
one billion US dollars in 1978 to nearly 30 billion in 
1998.”41 Furthermore, the removal of import duties 
on materials processed for exports motivated trade: 
“By 1987, the volume of foreign trade increased to 25 
percent and by 1998 to 37 percent of gross domestic 
product,”42 with even the United States beginning to 
experience trade de#cits.43 !e changes in Shenzhen 
were particularly astounding, evolving from a 
farmland of 20,000 residents to a modern city with 
a population approaching 10 million, characterized 
by urban sprawl and a skyline of skyscrapers.44 !e 
average per capita income also increased from 600 
yuan in 1984 to 2,000 yuan in 1992.45 Many residents 
who had $ed from Shenzhen to Hong Kong in hopes 
of a better life were returning.
 Another notable change was the migration of 
companies and individuals from inner regions to 
coastal cities. Industries $ocked to the SEZs: “In 
1979, 12 percent of China’s exports originated in 
Guangdong, but from the late 1980s as exports grew, 
roughly one-third or more of all Chinese exports 
each year came from Guangdong alone.”46 People 
followed suit, with Guangdong welcoming upwards 

39 Ibid., 420.
40 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 667.
41 Gregory C. Chow, “Teaching Economics and Studying 
Economic Reform in China,” China Economic Review 1, 
no. 2 (1990): pp. 193-199, https://doi.org/10.1016/1043-
951x(90)90006-a, 132.
42 Ibid., 131.
43 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 712.
44 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
406.
45 Ibid., 672.
46 Ibid., 401.

of 100 million migrants by 1992.47 Individuals began 
seeing past their local communities, willing to 
leave their familiar hometowns to chase wealth and 
opportunity. Unfortunately, this internal migration 
augmented income inequality, increasing the income 
gap between the prosperous urban populations living 
Guangdong’s coastal cities and their poorer inland, 
rural counterparts.48 !ese regional disparities 
became so pronounced that Guangdong residents 
made up to eight times the income of those in 
Gansu.49

 A lack of bureaucratic regulation introduced 
black markets, street crime, and corruption. 
Nepotism was rampant: many pro#table enterprises 
were run by the children of prominent Beijing 
o%cials while o%cials themselves abused their 
privileges to engage in gra" and bribery.50 However, 
Deng was prepared for this increased social disorder, 
believing it to be a worthwhile trade-o& in economic 
development. Using the analogy “When you open 
the door, $ies will get in,”51 he saw corruption as an 
inevitable, but tolerable, consequence of capitalism. 
 Similar to the household responsibility system, 
the success of the SEZs cannot be attributed 
solely to Deng. !ough the SEZs were legal, many 
conservatives in Beijing were unhappy. While Deng 
remained silent, general secretary Hu Yaobang 
actively supported and defended regional o%cials 
in Guangdong. When Beijing pressured local 
Guangdong o%cials, Hu worked to clear bureaucratic 
interference. As a result, Hu’s bravery was imperative 

47 Ibid., 407.
48 Yingyi Qian and Wu Jinglian, Transformation in 
China, In: Kornai, J., Mátyás, L., Roland, G. (eds) 
Institutional Change and Economic Behaviour (London: 
Palgrave Macmillan, 2008): pp. 38-63, https://doi.
org/10.1057/9780230583429_2, 43. 
49 Shigeo Kobayashi et al., “!e “!ree Reforms” in 
China: Progress and Outlook,” RIM Paci"c Business and 
Industries, 45 (1999).
50 I-Chuan Wu-Beyens, “!e Years of Reform in China: 
Economic Growth Versus Modernization,” Civilisations, 
no. 40-1 (1992): pp. 101-132, https://doi.org/10.4000/ci-
vilisations.1680.
51 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
707



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  20246

to the success of the SEZs, which would have 
otherwise fallen to government regulation.52

 Furthermore, Deng was fortunate that China 
“enjoyed favourable conditions [with Hong Kong 
and the World Bank] for a massive economic 
transformation” in 1979.53 While China remained 
largely isolated under Mao, Hong Kong’s youth were 
permitted to study abroad, gaining “a sophisticated 
understanding of modern #nance, high technology, 
and international markets.”54 !is knowledge 
signi#cantly improved productivity in the workforce, 
empowering Hong Kong to become a leading 
international #nance center in the 1960s.55 Eager to 
share expertise on Western business practices with 
their Guangdong counterparts, the Hong Kong 
workers provided China convenient access to crucial 
information and skills training in their transition to 
a market economy. On a larger scale, Vogel claims 
that “no institution played a role that could compare 
in importance with that played by the World Bank, 
and in no other country did the World Bank play a 
role as large as it did in China.”56 In 1985 at China’s 
request, the World Bank assembled a group of 
experts to discuss how to lessen the impact of the 
recessionary and in$ationary gaps endemic in the 
capitalist business cycle. At the conference, Nobel 
laureate James Tobin introduced Chinese economists 
to macroeconomic controls, emphasizing the ability 
of demand-side policies to in$uence the market.57 
!e newfound knowledge would later enable Zhao 
Ziyang to use #scal and monetary policy to soothe 
in$ation. Undoubtedly, Hong Kong and the World 
Bank stimulated and guided China’s economic 
growth. Still, an expanding world market and foreign 
aid would have been insu%cient without a leader 
like Deng who, unlike his predecessors, embraced 
learning from foreign experiences on the condition 
they did not threaten his political authority.

52 Ibid., 413.
53 Vince Cable et al., “From Deng to Xi: Economic Re-
form, the Silk Road, and the Return of the Middle King-
dom” (LSE IDEAS, May 2017), https://www.lse.ac.uk/
ideas/publications/reports/deng-xi, 2.
54 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
403.
55 Ibid., 403.
56 Ibid., 456.
57 Ibid., 461.

 !us, though the SEZs increased corruption 
and income inequality, Guangdong workers gained 
technical skills with support from Hong Kong and 
the World Bank, rural Guangdong coastal villages 
exploded into metropolitan cities, individuals 
began seeking and pursuing mobility opportunities 
in Guangdong, and China’s GDP and FDI both 
signi#cantly increased. !e SEZs not only opened 
China to the world, but also successfully built upon 
the economic development originating from the 
household responsibility system, undergoing further 
development in intellectual, social, psychological, 
and economic spheres.

Non-Economic Factors
 Modernizing China took more than economic 
development, supporting the thesis that the 
combined weight of other factors impacted China’s 
modernization far more than Deng’s economic 
reforms. !e $aw in crediting reforms solely to 
Deng was explored in the previous two sections. Key 
#gures such as Wan Li, Zhao Ziyang, and Hu Yaobang 
worked to implement and advocate for reforms 
while Deng stood passively in the background. 
!e important role of Hong Kong and the Word 
Bank in China’s integration into the world economy 
and the impact this had in multiple dimensions of 
modernization was also evaluated in the discussion 
on SEZs. To provide a more holistic analysis, this 
section contends the role of education reforms and 
the Tiananmen Massacre on China’s modernization.

Education Reforms
 Hoping to recover from a “lost generation” 
of students due to the Cultural Revolution, Deng 
was committed to legitimizing science through 
emphasizing a secular approach to knowledge.58 
!e Chinese education system was reformed, with 
the previous Soviet-style specialized education 
replaced by a liberal arts education o&ered in more 
comprehensive universities.59 !e result was the 

58 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
25. 
59 Gregory C. Chow, “Teaching Economics and Studying 
Economic Reform in China,” China Economic Review 1, 
no. 2 (1990): pp. 193-199, https://doi.org/10.1016/1043-
951x(90)90006-a, 138.



Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  2024

use of modern textbooks in university courses, 
translation of important foreign texts into Chinese 
for study, and encouragement to learn the lingua 
franca English, among others.60

 Deng was also a staunch supporter of learning 
from foreign scholars. Foreign education institutions 
collaborated with the Ministry of Education from 
1985 to 1998 to improve Chinese education standards 
while individual universities were permitted to 
invite foreign experts.61 Unlike the Soviets, Mao, and 
Chiang Kai-shek, Deng never feared that opening 
to the West would result in signi#cant brain drain, 
instead believing that “for China to modernize 
quickly, it had to learn about and adapt ideas that 
were working overseas.”62 Accordingly, from 1978 to 
2007, “more than a million Chinese students studied 
abroad” with around a quarter returning.63 
 Unfortunately, these rapid gains in education 
were only seen in cities: the quality of schools in rural 
regions lagged behind their urban counterparts.64 
Nevertheless, Deng created “by far the most highly 
developed “‘intellectual modernization’ in modern 
Chinese history” through addressing the cities 
#rst.65 Hence, a combination of a reformed internal 
education system as well as promoting study abroad 
opportunities accelerated intellectual development, 
establishing acceptance of the scienti#c method and 
bringing in “a surfeit of new ideas.”66

Tiananmen Massacre 
 !e Tiananmen Massacre challenges the 
assumed necessity of political development 
in modernization. Signi#cant resentment and 
frustration culminated in 1918 with the Tiananmen 
Massacre where Beijing called martial law on 

60 Ibid. 137.
61 Ibid., 137.
62 Ezra F. Vogel, Deng Xiaoping and the Transformation of 
China (Cambridge, MA: Harvard University Press, 2013), 
455.
63 Ibid., 456.
64 Ibid., 706
65 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
21. 
66 Ibid., 25. 

student protestors.67 Following the crackdown, Deng 
quickly reconsolidated power, suppressing all signs 
of dissent, and pushed for further economic growth. 
Spence concluded that this oppression served “both 
to distract the populace from making more political 
demands and to strengthen the nation as a whole.”68 
Deng was successful: urbanization continued, rural 
industrialization increased, and foreign investment 
soared. However, through the veneer of economic 
development, Deng failed in the dimension of 
political development, de#ned by Black as involving 
democratization and state capacity.69 
 Assuming “e&ectiveness” re$ects the 
government’s ability to promote their agenda, 
China was competent in implementing e&ective 
policies, demonstrating state capacity. Meanwhile, 
there appeared little e&ort to increase popular 
participation, a characteristic of democratization. 
!is unful#lled pillar of political development is 
analyzed in Clark’s “Chinese Development Programs 
in the 20th Century: Comparing Strategies and 
Success,” where he compares six recent strategies of 
Chinese development and evaluates them against 
Black’s model for modernization.70 Clark concludes 
that the lack of democratization, not only during 
Deng’s rule, but also throughout Chinese history, 
indicates that polity “might be an unpreferred style of 
politics by the Chinese.”71 However, this claim lacks 
validity, with many instances of demonstrations and 
protests for democracy throughout Chinese history. 
Wei Jingsheng’s dazibao on the Democracy Wall 
in 1978, which notes, “!e Fi"h Modernization: 

67 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
34. 
68 Jonathan D. Spence, !e Search for Modern China 
(New York, NY: W. W. Norton, 1999), 593.
69 Cyril E. Black, !e Dynamics of Modernization: Essays 
in Comparative History (New York, NY: Harper & Row, 
1966).
70 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
13. 
71 Ibid., 29.

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Aisthesis      Volume 15,  2024

Democracy…the Chinese people must #rst put 
democracy into practice and modernize China’s 
social system,”72 indicates a desire for democracy. 
Similarly, Fang Lizhi, an activist who inspired 
the Tiananmen Square protests, stated, “We need 
complete modernization, not just modernization in 
a few chosen aspects.”73 
 As such, it appears that it is not “Asian values,”74 
but rather an implicit social contract that prompts 
the Chinese to remain generally satis#ed with 
authoritarianism: “If they would let the communists 
continue to control the state, the regime would 
withdraw its many social and economic controls, 
giving people the freedom to ‘get rich.’”75 It is 
crucial to also consider the nation’s turbulent recent 
history. !e Chinese living through Deng’s reforms 
likely remembered Japanese imperialism and Mao’s 
dictatorship, events which ingrained instability in 
their psyche. Under Deng’s rule, relative prosperity 
and stability was #nally established for the #rst time 
in a century. Democracy is a privileged demand, 
signi#cantly less important than the ful#llment of 
basic needs, not paying bills nor providing a table of 
food. Deng was able to bring basic economic well-
being to most of the population. For many Chinese, 
their improved standard of living was enough, 
so they obligingly accepted their limited political 
freedoms.76 
 If Deng had succumbed to the students’ wishes, 
it is unclear if economic development would have 
continued. Deng’s own perspective, though biased 
towards authoritarianism due to his political 
position, still maintains some degree of reason: 
“!ere are so many Chinese people, and each has 

72 Alexander V. Pantsov and Steven I. Levine, Deng Xia-
oping: A Revolutionary Life (New York, NY: Oxford Uni-
versity Press, 2015), 340-341.
73 Ibid., 401.
74 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
29. 
75 Ibid., 34.
76 Jacques deLisle and Avery Goldstein, To Get Rich Is 
Glorious: Challenges Facing China’s Economic Reform and 
Opening at Forty (Washington, D.C.: Brookings Institu-
tion Press, 2019), 6-7. 

his own viewpoint. If there’s a demonstration by 
this one today, and that one tomorrow, there’d be 
a demonstration every day, 365 days a year. In that 
case, economic construction would be entirely out 
of the question.”77 Minxin Pei, a Chinese-American 
political scientist with expertise on governance in 
China as well as democratization in developing 
nations, supports Deng’s statement, claiming a 
“strong state leadership is necessary to protect and 
promote their economic gains,” and that political 
reforms should be secondary to economic reforms 
in developing countries.78 !eorists agree: “too much 
participation in developing nations could destroy 
fairly weak governments by overwhelming them 
with political demands.”79 As such, some historians 
believe it was only with complete control that China 
was able to hyper-focus on expanding its economy; 
allowing political participation would have detracted 
from that goal. Nirmal Kumar Chandra, a renowned 
Indian economist, similarly re$ects: “I was highly 
critical of the Chinese leadership at that time… But 
on hindsight…I would now concede that Deng was 
correct in apprehending the worst if the party had 
accepted the students’ demand.”80 All in all, it can be 
concluded that the Tiananmen Massacre and overall 
suppression of political participation was justi#ed by 
Deng and accepted by the populace for the supposed 
challenges democracy would have brought to China’s 
rapid economic growth, the foundational key to 
modernization.

Conclusion
 Achieving rapid economic growth between 1978 
and 1988, China recorded the highest growth rate in 

77 Barry Naughton, “Deng Xiaoping: !e Economist,” !e 
China Quarterly, no. 135 (1993): pp. 491-514, http://www.
jstor.org/stable/654099, 502.
78 Minxin Pei, From Reform to Revolution: !e Demise of 
Communism in China and the Soviet Union (Cambridge, 
MA: Harvard University Press, 1994).
79 Cal Clark and Jane Sabes, “Chinese Development Pro-
grams in the 20th Century: Comparing Strategies and 
Success,” American Journal of Chinese Studies 8, no. 1 
(2001): pp. 13–39, http://www.jstor.org/stable/44288654, 
28. 
80 Nirmal Kumar Chandra, “Legacy of Deng Xiaoping,” 
Economic and Political Weekly 32, no. 13 (1997): pp. 642-
644, http://www.jstor.org/stable/4405222, 624.

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Impact of Deng Xiaoping’s Economic Reforms in China’s Modernization

Aisthesis      Volume 15,  2024

the world in the 1980s. With a 9.8% increase in GDP 
from 1980-1985, they greatly surpassed the 2.6% 
world average.81 Within one generation and without 
signi#cant political upheaval, economic growth 
allowed both China’s living standards and global 
standing to improve phenomenally.82 
 Deng’s economic reforms led to this growth, 
providing the basis for future development. !e 
household responsibility system li"ed millions of 
peasants out of poverty while resolving China’s grain 
shortage crisis through decentralizing ownership of 
land plots. Special Economic Zones, areas governed 
by the free market, introduced China to the world 
economy. By opening up to foreign aid, trade, 
and investment, China experienced signi#cant 
urbanization, internal migration, and increases in 
GDP. 
 However, these reforms on their own would 
not have resulted in economic growth if not for the 
support from other proponents of economic reform 
such as Wan Li, Zhao Ziyang, and Hu Yaobang, as 
well as friendly allies like Hong Kong and the World 
Bank. !ese external factors working to ensure 
Deng’s economic reforms were carried out in reality, 
combined with education reforms, allowed China 
to advance its intellectual, social, psychological, and 
economic development.
 Furthermore, by employing gradualism and 
pragmatism rather than shock therapy, which many 
European countries used in their development, 
Deng’s successful transition to a market economy 
o&ers a new model of economic modernization for 
current autocracies. However, with analysis on the 
Tiananmen Massacre, it becomes evident that these 
regimes can e&ectively exploit gains in economic 
freedom as reason to placate political demands. 
As such, it is unclear whether this system can be 
maintained into the future as the Chinese grow 
accustomed to their improved living standards and 
begin seeking more personal freedom.
 All in all, considering the multitude of factors 
involved in China’s modernization and the inability 

81 World Bank, World Development Report, 1998 (New 
York, NY: Oxford University Press, 1998).
82 Clem Tisdell, “Economic Reform and Openness 
in China: China’s Development Policies in the Last 30 
Years,” Economic Analysis and Policy 39, no. 2 (Septem-
ber 2009): pp. 271-294, https://doi.org/10.1016/s0313-
5926(09)50021-5, 292.

of economic reforms to initiate democratization, 
Deng Xiaoping’s economic reforms from 1976 to 
1989 can be considered only slightly signi#cant in 
modernizing China.

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