ABSTRACT
The Chinese economy is in the middle of a new transition. China's economic performance during the reform period is sometimes described as the 'China puzzle'. Many economists call it the 'China miracle' because of its extraordinary economic growth. The chapter argues that the Lewis turning point (LTP) of China's labor market is one of the most fundamental triggers of Chinese economy's transition from economic miracle to 'normal development'. China has been known for its abundant labor and low wages, which helped turn China into a global manufacturing center within a relatively short period. In addition, China's reform success was until recently a story of the coastal regions. However, inland economies are now growing more quickly than the coastal economies, thanks to the government's 'go west' policy, the migration of manufacturing industries, and rich resource endowments in western China.
