China and the West

Helen Dunstan ist Mitglied der Australian Historical Association.

First Chinese international academic conference on William Faulkner in China.

Vincent Shen ist Vorsteher des Department of East Asian Studies der University of Toronto.

Wang Gungwu ist University Professor der National University of Singapore.

Wang Gungwu ist Vorsitzender des Management Board des East Asian Institute, Singapore.

Zhang Longxi ist Book Series Editor der Brill's humanities in China library.

Vera Schwarcz ist Vorsitzende des Program of East Asian Studies der Wesleyan University, Middletown.

Julia K. Murray ist Visiting Scholar am Fairbank Center for Chinese Studies der Harvard University.

Paolo Santangelo ist Professore ordinario di storia della China der Università di Napoli "L'Oriental".

Michael Saso ist Berater der International University in Beijing, Kyoto und Los Angeles.

Paul S. Ropp forscht und reist in Beijing, Shanghai, Tokyo, Kyoto, Taipei und Seoul.

Shun Kwong-loi ist Professor of Philosophy der Chinese University of Hong Kong.

Hont, Istvan. David Hume and Adam Smith on China [ID D27258].
Adam Smith quipped several times that China was so distant that it could not possibly be a real concern for the political thought and emotional social life of eighteenth-century Britons. He knew that trade already connected China to the European West, but he explained that the immense distance and the consequent transport costs made trade in anything but in very valuable objects, such as silver specie, porcelain and perhaps tea, impossible.
Low wages, Smith conceded, were a huge advantage in price competition. 'The cotton and other commodities from China', he said in his lectures 'would undersell any made with us, were it not for the long carriage and other taxes that are laid upon them.' But, he further argued, Hume was wrong in believing that the Chinese case supported his assessment of the development chances of Scotland and other poor European countries. The case of China, Smith claimed, did not show that poor countries can 'undersell' rich ones. China was not an oriental version of Scotland or Ireland. Chinese wages were not low because the country was undeveloped. Rather, China exemplified the competition between rich and developed countries that had differential wage rates. China was a very developed and immensely sophisticated country with a long history in skill formation, longer than that of modern Europe. China was a rich country. Its unusually low wages reflected not poverty but China’s special historical development.
In many ways, Smith remarked, eastern China was the most fertile and the most successful of these civilizations. It was also the one that survived the ravages of history.
Agricultural societies could develop intensive trade if they were built around a network of navigable rivers and canals. Smith saw China as a manufacturing and trading country, with agriculture remaining the primary mode of living. Smith noted the well known fact neither Egypt nor China developed sophisticated maritime trade and both practically operated as a closed commercial state. In the success of this closed commercial state China's size mattered enormously. The Chinese domestic market was the same size, according to Smith, as the marketplace of Europe. It also developed a comparable sophistication and intensity. At the dawn of modernity China and Europe were equals. Many European observers in the eighteenth century, from Leibniz to the leader of the Physiocrats, François Quesnay, saw China as superior in economic policy to Europe, because of the Chinese government's consistent support to agriculture rather than industry. Smith noted this, but attributed it to the tax system. The income of the Chinese elites came from the land tax and therefore they cultivated their tax base. They also maintained and developed the internal waterways. On the whole, however, Smith saw China’s government as an obstacle to further development. He noted that European travelers who saw China two or three centuries apart, described it in very similar terms. China was a stagnant or stationary society, which reached the highest level of development that was compatible with its political system some while ago. In the next stage, China got stuck.
The stationary condition of China explained China's low wages. In such a condition the competition for jobs was intense, keeping down wage levels. The population initially grew fast, but with the coming of the period of stagnation it also put enormous pressure on China's economic capacities. In stagnant China the urban poor were significantly poorer than even the most the hard-up labourer in any decent European country. Similarly low wages in a rich European country would have signalled both economic collapse and moral decline. Smith’s description of the fate of the urban poor in Canton, not able to afford permanent housing, living on river boats and often eating the flesh of dead dogs fished out of the water signaled to his readers the extreme marginality of the life of the Chinese poor. However, China was not in decline and its population was not shrinking. In states where there was genuine decline, Smith claimed, such as Bengal ruined by the English, the unemployed faced unspeakable deprivation and starvation, conditions much worse than the lot of China's poor. In China there were several factors that made survival possible. The money supply was tightly controlled, price inflation was kept at bay, and the immense productivity of rice based agriculture made the purchasing power of China's low wages much higher than an equivalent income in Europe.
Smith's analysis of China foreshadowed Marxian theory. China was a sophisticated manufacturing and trading country with a solid agricultural base, but the development of its productive forces was constrained the existing relations of production, by the hierarchical ordering of society and by the faulty economic policy of neglecting foreign trade. Given that at the beginning of modernity, basically up to the early eighteenth century Europe and China were equal in trade, Smith asked himself the question what allowed Europe to jump ahead. To some degree the miracle was Europe's ability to close the gap with China in the first place and Smith explained how the German shepherd states benefited from the surviving commercial culture of the Roman empire which acted as a catalyst for the accelerated pace of Europe's late-medieval and early modern growth. China, which developed continuously since ancient time achieved this level of development earlier. What allowed Europe to catch up was China's subsequent stagnation. What allowed Europe to overtake China, however, was the dawn of globalization from the late 1400s. With the age of discoveries Europe branched out into long distance trade and opened up vast markets for itself through developing merchant companies and colonial projects. Suddenly, in a mere two hundred years, Europe's markets became globalised and vastly larger than the internal market of the continent, which was commensurable with that of China. Development required markets and Europe now found them in other parts of the world. These huge new markets allowed much faster development that otherwise could have been achieved, even if Europe's ill conceived colonial and monopolistic policies failed to utlize the new chances optimally.
Smith did not advocate political revolution in China. Rather, he was thinking about the possibilities of breaking China's economic stagnation through new economic policies. China, he decided, had to learn from the lesson of European economic development. The answer had to be the enlargement of China's markets, in order to facilitate the expansion of Chinas economy, with all the attendant benefits of allowing productivity growth by specialization and also healthy population growth. The measure that could kick start the Chinese economy and allow it to exploit its slumbering potentials was the abandonment of its policy of a blocking foreign trade. Through foreign trade China could enlarge its markets instantly. Smith seems to have also advocated a sort of Chinese Navigation Act or at least a policy to use a newly created Chinese merchant navy for carrying this trade. What was, however, more important was enlarging China's markets by any means, even with the assistance of European merchants and shipping companies if necessary. This could unleash, Smith claimed, a cycle of imitation and emulation. Up to this point China could only learn from observing the economic development of Japan. By opening itself up to European influences, however, China could learn the recent production technologies of Europe and import modern European machinery. Smith, like Hume, put an enormous emphasis on the psychological effect of foreign trade in economic development. Interacting with foreign cultures could lead to innovation and economic growth. It seems that Smith envisaged a China that could easily catch up with Europe. The favourable exchange rate, the low price of agricultural wage goods and the low-wage culture inherited from the long period of stagnation could all work in China’s favour. If the transport problem could be solved, China could conquer European markets and saturate it with high quality but low price products.
Like Hume, Smith did not elaborate the scenario of a transport revolution. However, they both specified the outcome of the process whereby distant Asian civilizations acquired a modern economy. Hume, in tune with his general theory of economic development, claimed that a country like China will be able to grow with high speed only in the transitional period when its wages were still relatively low. Once China's growth raised wages to their appropriate levels in a civilized economy, China's wage advantage would cease. Smith focused more on the military consequences of this process. For both Hume and Smith globalization represented a fundamentally positive process in which the reciprocity underlying commercial exchange could potentially benefit all nations, whether European and commercial or not. Smith, following the lead here of the abbé Raynal and Diderot, lamented the fact that Europe's quest for global trade brought enormous suffering to other parts of the words, through conquest, imperialism and unequal exchange. However, he claimed, these negative consequences were not integral to the nature of commercial globalization. They were caused by the fact that at the time of the opening up of global trade routes, and in the period afterwards, Europe enjoyed significant military superiority over the rest of the world. This could change if Europe's power declined. More likely, Smith claimed, it could change by commercial globalization itself. As the rest of the world benefited from trade, it could grow richer. By acquiring wealth fast growing Asian nations could also acquire military technology and hence significant military strength. One of the most beneficial effects of commercial globalization was therefore the globalisation of the balance of powers. Smith did not envisage a world state and claimed that the relations between states had to continue to be conducted without a sovereign power adjudicating conflicts and suppressing tensions.

Hans van de Ven ist Berater der Association for Cultural Exchange Study Tours, Guide and design study tours to China.

Ellen B. Widmer ist Edith Stix Wasserman Professor of East Asian Studies des Wellesley College.

Lothar von Falkenhausen ist Mitglied des Editorial Board von San xing dui yan jiu.

Helen Dunstan ist Vorsitzende des Chairs' Forum der Faculty of Arts der University of Sydney.

David K. Jordan ist Visiting Professor of Anthropology an der Hong Kong University of Science & Technology.

David Hinton received the PEN Award for Poetry in Translation.

Bryna Goodman ist Mitorganisatorin der International Conference on Colonialism and Chinese Localities in Qingdao.