All that said, I think the diversity and distributed power structure in India could not be overcome by any purely economic philosophy.
About China we should also mentioned that decreasing the control over the economy is what allowed them to grow. Current policy in China is much more like the West then it was under Mao or afterwards. So success came by reducing control over the economy and to reintroduce private property. Market economy today is as powerful in China as it ever was in the history of China by far.
China so far has profited from massive catch up growth and China is not unique in that, just much bigger. The same thing happened with the Asian Tigers. China is now starting to pull ahead in some technologies, but it has yet to be seen if how far that is possible. People also thought Japan would blow past US and the West.
In the end if you have a reasonable competent government and a reasonable market economy with reasonable polices regarding global trade you will likely end up on the same overall growth path of all the advanced economies.
If China manages to avoid this keep growing after the have reached per person parity, I would be incredibly impressed and it would challenge my thinking on economics.
> You are mixing up periods
I am talking about the pre-WW2 period where production was overwhelmingly focused on everything needed for military production. There were exceptions like housing construction but the overwhelming focus was military buildup.
While I agree with you that it definitely shouldn't (mankind already had one too many cultural revolution last century), I think you vastly underestimate the destructive power of totalitarian states…
> The same thing happened with the Asian Tigers. China is now starting to pull ahead in some technologies, but it has yet to be seen if how far that is possible. People also thought Japan would blow past US and the West.
The Asian tiger are also a good example of sucessful central planning though… And Japan did indeed blow past the west by most metrics… including population aging, which has since then crippled the country.
What metrics exactly? Certainly not GDP per capita. It also has the lowest productivity per hour of the OECD countries.
Japan has been almost stagnant for nearly 30 years now, mainly because of demographics (and other reasons, but with such an aging population it's pretty much game over no matter what), but by 1990 Japan has a better GDP per capita than any of the biggest economies in the world at this point, by far (more than 20% over some most western countries). Obviously, when your GDP stay flat for 3 decades, other end up catching up…
> It also has the lowest productivity per hour of the OECD countries.
Productivity is a poor metric, because there is little correlation between time spent working and GDP, so culturally workaholic (Japan) countries ends up with poor results, while hedonistic countries (France) score super well, but that doesn't reflect much.
Not really. I think people wastly exaturate the amount of central control because that is what they want to focus on. People love to say things like 'look the government invested in X industry and that insutry is now successful'. Ignoring the tons and tons of wasted investment and industries that didn't go anywere. It also ignored the massive amount of success private companies had that didn't explicity been pushed by specific government planning.
The believe that Japan only has problems because of an aging population is also pretty false and was even more so in the early 1990s. I disagree that Japan blew past the West in most metrics, in some maybe but in others they are worse.
Yes, and with tremendous success (literacy exploded, and starvation plummeted), but such movement is long dea and now. For the past 30 years Indian economic policies have been heavily inspired by the western “neoliberal” trend (which is itself heavily inspired by Hayek's work) . And looking back how China where in 1980 and how they are now is quite telling. Five-years plans really add up in the long run…
But if you don't like the comparison with India (which, now I realize, is pretty ill-advised in this period of nationalist tensions between both countries …), you could do the same with most Western countries and still be astonished how China went and how stagnant we have been.
> And this great plan also didn't lead to much improvment for the actual people, it was primarly about the production of military equipment.
You are mixing up periods: here you are referring to the cold war era (with the arm race with the US) but that wasn't the case at all pre WWII (and they didn't really started the war with stockpiles of new weapons to say the least…).