social orders, to which many theories of capitalism rightly attach great significance—Marx’s capital and circulation analysis, Rosa Luxemburg’s theory of accumulation, Schumpeter’s analysis of entrepreneurism, as well as Keynes’s or Polanyi’s theories, for example. The relevance of these theories is found in their insistence on the contradictions and conflicts of the capitalist development process and their structural susceptibility to social tensions and uncertainties.
Thus, the growing interdependencies between socioeconomic processes are just one aspect of the capitalist reproduction process. Even if the modern division of labor can be seen as the primary source of social solidarity and the basis of moral order (Durkheim 1988, 471), it will only develop its distinctive capitalist form as part of competition-driven accumulation, that is, the permanent competition between individual production units that creates an innovation dynamic rife with crises and conflicts. This is linked to the fact that capitalist modernity is an arena for social relationships where rationalization develops only in a particularist way (Adorno 1996, 231). This is precisely because the decisions taken by intentionally rational actors are often anchored in fiction or, in other words, based on unrealistic expectations (Beckert 2011). Thus, I argue for the transformation of China’s political economy to be linked with the unstable dynamics of capitalist development and the constant crisis-ridden and uncertain renewal of the system.
(2) To describe commonalities and differences between types of capitalism, I draw on the concept of an international variegated capitalist world system (see Jessop 2009; Streeck 2010a). Commonalities are based on the fact that the modern world market results from interaction between an incalculable number of different factors. The world market is thus a globally dynamic synergy of actions and exercises significant imperatives to act. The reproduction of the global economy as a whole embodies a process without a steering subject that results in innumerable unintended effects. Even when specific development paths form in a national context, they are subject to external adaptive pressure, which might be relativized through national or regional path-dependent tendencies toward inertia but which cannot be prevented altogether. The relatively simultaneous and universal nature of the great capitalist crises of the 1870s, 1930s, 1970s, and 2008–9, although occurring under different socioeconomic, political, and cultural conditions, points to this very correlation (R. Brenner 2006). This trend has grown stronger since the 1970s, as research into the transnationalization of value chains demonstrates (Gereffi, Humphrey, and Sturgeon 2005). The almost universal appearance of liberalization tendencies since the 1970s is also evidence of this.
At the same time, the differences between individual forms of capitalism have to be taken into account. Contrary to the hypothesis of the neoclassical model (for a critical account, see Kaldor 1972), global competition does not act as a force for harmony between the units of capital, leveling differences between companies, regions, and, ultimately, nations. This convergence hypothesis is based on untenable premises—such as the assumption of perfect competition and market transparency, homogeneous goods, and constant production technology and demand structures. It ignores the spatiotemporal development of companies, and the varying degrees to which institutions are embedded, as well as the reality of disparities in the development of capital due to differences in productivity levels. The expansion of capitalism thus brings about severe spatiotemporal disparities not only between but also within OECD and newly industrialized or developing countries. Global accumulation processes are implemented unevenly because the various national societies provide different conditions for the establishment and reproduction of capitalist production relationships (Block 2005).
(3) In terms of methodology, a transnational perspective is well suited to a study of this nature. Modern-day societies should not be viewed as separate entities but must be seen as a federal, overlapping nexus (Mann 1990). Capitalist-driven societies can be adequately analyzed only in the context of their integration in global economic, global political, and other intersocietal relationships. Limiting observations to national territory is insufficient. Instead, we need to examine how national, international, and transnational mechanisms overlap and engage with one another. As emphasized below, even advanced neo-institutionalist China research often fails to factor in global or macroregional economic conditions. The result is a one-sided explanation of the successful rise of the PRC, which is described as the result of inner-societal innovation and regulatory capacity (McMillan and Naughton 1996; see also the overview of China research by Perry 2007, which excludes international influences almost entirely).
(4) The unstable dynamics of capitalist social orders, specifically those in newly industrialized countries, can be explained by the notion of uneven, combined and interconnected development (Rosenberg 2006; Selwyn 2011; ten Brink 2014b). This refers, inter alia, to the combining of old and new, premodern and modern forms, and intra- and intersocietal developments, which lead to unexpected consequences, particularly in late-developing societies (Gerschenkron 1966). The fact that economic development from the late 1970s, specifically in China, would trigger such a true “leap forward,” beyond the level of development determined by modernization theory, could not really have been predicted. To help overcome its backwardness, the Chinese economy was able to profit from the development advances in dominant economies: through the transfer of technological and organizational expertise, or against the backdrop of the slowdown in growth in the old centers, fueled by foreign direct investment (FDI). Also, the selective adoption of elements of advanced countries led to a combination with autochthonous structures and historical traditions, resulting in a distinctive new type of society.
(5) I also use another research assumption from economic sociologists, who explain that the reproduction of capitalist markets and the companies operating on those markets rely on noneconomic preconditions and mechanisms of cooperation (Aspers and Beckert 2008). Modern societies are coconstituted through the interaction between market-mediated and nonmarket social relationships. As social and political institutions have some capacity to reduce market uncertainties, they need to be included in the analysis of socioeconomic development (Fligstein 2001).
Markets themselves are permeated by a series of nonmarket coordination mechanisms (see Lütz 2003; Thompson et al. 1991). In addition to market-based coordination, the economy is also made up of other governance types such as company hierarchies, networks, associations, and bureaucracy. The production and distribution of goods and services is not merely the product of competition and price mechanisms but is also facilitated by hierarchical regulatory mechanisms (Beckert, Diaz-Bone, and Ganßmann 2007). Trust also acts as a foundation for economic action. “Only after trust has been created, are the necessarily complex transactions possible. In particular, access to capital can be eased, as illustrated by the rotating credit associations among Chinese entrepreneurial families” (Deutschmann 2009b, 21, my translation). Moreover, as with any other form of societal embedding located between market and hierarchy, we must be careful not to underestimate power as a factor in market relationships. These include the network as a form of coordination and, extending on this, communities shaped by solidarity evolving over the course of history or clans. Because of the fact that the various types of coordination can be combined in a number of ways, we must assume that many different forms of capitalism exist (Bradach and Eccles 1991; Stark 1996).
(6) The modern state represents the most important nonmarket-based institution, and not only in China. In contrast to other organizational forms, the modern state can generally rely on support from the legitimate monopoly on the use of force. It should be noted that, unlike in precapitalist societies, where the economically dominant classes normally had to resort to direct force to appropriate surplus product, in capitalist systems free contractual relationships regulated by what is at least formally an independent authority are required in both production and market activity. The state, in defining property rights, creates the main prerequisites for market activity (Bidet 1991). Any economic analysis must therefore always include politics. Without a relatively autonomous political authority with a monopoly on the use of force, establishing successful capital accumulation will prove difficult in the long term. As an ensemble of contradictory relationships, the state guarantees integration and adaptation, making the continuation of capitalist socialization possible in the first place—“they include the pacification of social life (stressed by Elias), the overall
