The China model, the Great Recession, and the rise and fall of the great powers

This chapter examines historically informed causal tendencies between a country's rise, its model, and financial crises. The Great Recession shows that risks are inherent in the financial sector. China's performance during the Great Recession is obviously good for the country. The hybrid nature of the reforming Chinese political economy in a catch-up transitional stage explains partly why China has been able to achieve rapid economic growth. This feature of the Chinese political economy system also explains why China has been able to manage the Great Recession and why the China model has limited utility for the international community and for China's own future success. The rise and fall of great powers is a central question for international relations because developments on that level can change the international system and have often caused global conflicts. The China model is not a rejection of Western capitalism. On the contrary, it partially embraces the capitalist system.