ABSTRACT
Following this logic, the study is putting forward a hypothesis that China’s state capitalism, facing a downturn external demand and severe internal overcapacity, has been forced to evolve from amercantile stage, inwhichmost subsidieswere designed to influence factor conditions and supporting industries, to a new stage of domestic consumption with a policy on reshaping demand conditions prioritized to absorb redundant capacity and achieve such non-economic goals as environmental protection and social stability.
