Overcoming the Great Recession: Lessons from China

Since the onset of the current international financial crisis, we have been thinking about how long the crisis could persist, what international impact it could have, and how we could respond effectively. In 2010, we initiated a comparative study of the Great Depression of the 1930s and the international financial crisis we are witnessing today, in which researchers from the People’s Bank of China, the China Banking Regulatory Commission, the Chinese Academy of Social Sciences, the Development Research Center of the State Council, Peking University, and others participated. Each of these participants made excellent contributions, and this paper is the outcome of their valuable work. Generally, financial and economic crises are one of the inherent features of the capitalist system. Starting from the Industrial Revolution, crises have occurred frequently in the capitalist world. Among them, the Great Depression in the 1930s and the present international financial crisis are the two most widespread and disruptive examples, both of which occurred when problems in the capitalist system accumulated beyond self-adjustment.