After reading Dr. William H. Janeway’s “The Rise of Mesoeconomics”, I found a common ground between China’s policymakers and Western economists like Dr. Janeway.
In his article, Dr. Janeway argued “The digitalization of economic life and real-world data has opened up new possibilities for the study of the economic networks, regions, and sectors that ultimately determine how economic policies play out in the real world.”
He talked about the “meso (middle) domain between microeconomics and macroeconomics”, the “existing relationships between firms within and across markets, supply chains, and financial networks, and “Leontief’s pioneering study of the structure of the US economy, modern input-output tables detail the complex patterns of input linkages across hundreds of industries”. I believe this is what Chinese economic policymakers are thinking.
One piece of evidence is the title of the Resolution of the Central Committee of the Communist Party of China on Further Deepening Reform Comprehensively to Advance Chinese Modernization. “Comprehensively” appears 16 times in the Resolution.
Xi Jinping elaborated in his “Explanation of resolution of CPC Central Committee on further deepening reform comprehensively to advance Chinese modernization” that one of the highlights the Resolution features is “advancing reform in a comprehensive manner.”
In recent official documents with importance, “全面”(often translated as comprehensive or all-round), “系统” (often translated as systematic), and “整体” (often translated as in holistic approach or integrated), are often seen, which indicating the comprehensive way of thinking of Chinese policymakers.
In the Report to the 20th National Congress of the Communist Party of China, another milestone document of the CPC, Xi talked about the worldview and methodology of the Thought on Socialism with Chinese Characteristics for a New Era (新时代中国特色社会主义思想, which is the guiding ideology of China.) He said “We must apply systems thinking. All things are interconnected and interdependent. We must view them with the understanding that they are universally connected, part of a complete system, and constantly evolving if we are to grasp the laws governing their development.
What I think is similar to his words to Dr. Janeway’s mesoeconomics is the recognition of connectivity among things.
He explained that “As a major developing country, China is still in the primary stage of socialism and is going through an extensive and profound social transformation. A small move made to advance reform and development or to adjust interests may affect the bigger picture. We should be able to see the present from a historical perspective, look beyond the surface to get to the crux of issues, and properly manage the relationships between overall and local interests, between the present and the future, between macro and micro concerns, between primary and secondary issues, and between the special and the ordinary. We should improve our ability to adopt a strategic perspective and apply a historical, dialectical, and systematic approach to thinking; we should get better at thinking creatively, thinking in terms of the rule of law, and considering worst-case scenarios. By doing so, we can develop a well-conceived approach to planning and advancing the endeavors of the Party and the country on all fronts in a forward-looking and holistic manner.”
I have explained in a previous post “The Rise of Connectivity Politics and China’s Foreign Policy” that connectivity thinking is built-in in Chinese philosophy. The two pillars of contemporary Chinese philosophy are traditional philosophy and Marxism philosophy. Both emphasize connections in the world. Marxist dialectical materialism holds that everything in the world is interconnected. In China’s traditional philosophy, “天人合一”(unity of heaven, earth, and humanity), “相生相克” (mutual generation and restraint between different elements or forces in the natural world) and many other concepts express the connectivity thinking. These concepts all embody a holistic perspective in traditional Chinese philosophy, suggesting that everything in the world is interconnected and interdependent, with no isolated existence.
So China has “Five-Sphere Integrated Plan” (“五位一体总体布局”) and “Four-Pronged Comprehensive Strategy” (“四个全面”战略布局). They all try to promote coordinated economic, political, cultural, social, and ecological advancement in a comprehensive way and make overall arrangements for both economic structural reform and reforms in other areas.
According to Wikipedia’s definition, Mesoeconomics or Mezzoeconomics is a neologism used to describe the study of economic arrangements which are not based either on the microeconomics of buying and selling and supply and demand, nor on the macroeconomic reasoning of aggregate totals of demand, but on the importance of the structures under which these forces play out, and how to measure these effects.
There are reasons to believe that in the 21st century, Mesoeconomics may be a better choice in planning our economic and social development than macro- and micro-economics only. As we are in a more complicated world, we have to take a more sophisticated approach.
China's reform is a systematic large project involving multiple fields such as economy, politics, culture, society, and ecology. These fields are intertwined and interact with each other, forming an organic whole. There is a saying in Chinese to describe this kind of correlation — “Pull one hair and the whole body is affected” (牵一发而动全身). Adhering to the concept of systems means that China will regard reform as a dynamic process in practice and fully recognize the internal connections and interactions among various reform measures.
For example, in China’s construction of ecological civilization, relying solely on end-of-pipe treatment cannot solve environmental problems. It is necessary to start from multiple aspects such as production methods, consumption patterns, laws, and regulations, and take comprehensive measures to form a joint force of change.
In the “guiding ideology for further comprehensively deepening reform", the Resolution proposes three "pay more attention to". The first one is "pay more attention to system integration". Because the complexity of reform is determined by the systematic nature of society itself. Society is an organic system with diverse elements and a strict structure. In this system, elements are not only interconnected and interpenetrating with each other and between elements and the system, but also mutually restricted and interacted. The change of any element can affect the system and other elements, thus having a wide range of impacts.
I believe more and more people, including policymakers in more countries, will listen to Dr. Janeway and other mesoeconomists to take a more comprehensive view on social and economic development. ###
Chinese philosophy?
Calling Confucian political science 'philosophy' does it a great disservice. It in no way resembles the airy Greek speculation we in the West call 'philosophy.
Calling it 'political science' is more accurate and, above all more instructive.