The Rise of China

Pudong Skyline of Shanghai


China recently edged out Japan to become the world’s second largest economy by nominal GDP, though they’ve been far ahead of Japan based on purchasing power parity for some time. China’s rise to economic dominance has caused queasy stomachs and raised eyebrows for some in the West, while others have been gloating with self flagellating glee as they put on their kneepads in preparation for the coming of their Chinese overlords.

A reoccurring dismissal of the Asian giant’s meteoric ascension is that China is unequally developed, with the rural inland areas being far behind the urban coastal areas. This is a weak argument based on some vague egalitarian notion of equal distribution of wealth. China is a massive nation with over 1.3 billion people. It’s a special ed fantasy to expect the whole of China to reach modern industrialized levels in the short time since they adopted free market reforms. This criticism would be much like deriding western Europe for being more advanced than eastern Europe. While China is not on par with the West or Japan in terms of per capita income, they have a middle class of 300 million and growing. If a day comes when the entire population does reach a Western standard of living, they’ll have an economy so large that no one will be able to touch them. We may eventually see a global superpower far surpassing the United States that unapologetically acts in its own self interests without regard for the concerns of the rest of the world.

One of the factors behind the assertion that China will reign supreme is the belief in the population’s high median IQs. Most of this belief stems from the high IQs and high tech economies of other East Asian countries, but China covers an area so large that the East Asian categorization is an oversimplification. The current political boundaries of the nation are the result of centuries of warfare and political consolidation, with China being a long lived empire that imposed rule on a patchwork of disparate peoples. Even among the Han, there is large cultural, linguistic and genetic differences. The northern Chinese are more similar genetically to other northern Asians like the Koreans than they are to their own southern countrymen. Should we expect a genetically diverse people to have similar average IQs?

The current estimate of an average IQ of 100 comes from the work of Richard Lynn based on studies showing an urban coastal Chinese mean of 105, then guesstimating that downwards by assuming a lower IQ in the rural areas. It’s been a long standing trend that urbanized areas have higher IQs than rural areas, which is likely the result of both increased nutrition and selective immigration to cities. Lynn’s estimate of 95 for inland China may be correct, but without corroborating data to back that up, it’s simply a guess. What is the actual mean IQ? Well, it’s likely that China’s central government has studied it, but if the numbers are lower than the current estimates, we’ll never see those figures.

But let’s consider those numbers are correct for the time being. What future can we expect out of China? The advancement in technology and science is directly related to a nation’s smart fraction, the percentage above a certain threshold of intelligence. If we assume that East Asians have the same distribution of intelligence as Europeans then the percentage of China’s(and the rest of Asia’s) future population with an IQ above 130 would be as follows:

In the chart we see different estimates based on projected population numbers for 2050 and possible rises in IQs due to the Flynn effect as poorer nations industrialize. Even with a mean IQ of 100, China would have a smart fraction almost five times higher than the U.S. and this doesn’t take into account the likely drop in American IQ as the nation embraces diversity. Some have suggested that these numbers are wrong, because East Asians don’t have the same distribution of IQ as Europeans, which superficially seems plausible. The problem is that there is no evidence showing this and I’m sure while analyzing global test scores, Lynn would’ve reported a sharp variation in IQ percentages had they existed.

Another commonly expressed idea among Westerners is that while East Asians may have higher IQs, they are not as creative as Europeans. East Asians have contributed many interesting developments during the modern era and generally have technologically advanced societies, but the majority of innovations still come out of the West. Is this due to cultures that promote uniformity of thinking or do these cultures exist because of an innate need to conform because of millennia of domestication through civilization? Whatever the case, China’s dramatic rise couldn’t have occurred without a highly intelligent population that has been able to rapidly adopt Western technology and science. It doesn’t really matter where the innovation comes from; as long as it exists, the Chinese will be able to exploit it.

There is no doubt that the 21st century will see China as a central player on the world stage. What will this mean for the U.S. and the rest of the world? We are already seeing a shift away from American hegemony in Asia, with China becoming the biggest trading partner of most of the nations in the region. As China’s economic influence grows, they’ll be able to flex their muscles with increasing strength. They are currently building up a blue water navy with attempts to match the U.S. in capacity and numbers. Right now they are technologically behind, but it’s doubtful that other advanced nations would turn down Chinese money in exchange for military tech. A time will come when China, like the U.S. before it, will use their military might to protect their interests. China has invested heavily in Africa, developing infrastructure, refineries, factories and mining operations. With 100,000 Chinese nationals currently living on the continent, China could easily find an excuse for military invasion if instability threatened the lives of their citizens as well as their business interests. With China holding so many U.S. dollars and being an integral trading partner, there’ll be little the U.S. could do if China moved into Africa, besides giving stern condemnation.

What could be the pebble that trips this giant? Well, besides the threat of global economic meltdown that we currently face, China’s diverse population could also unravel a nation that has been held together through threat of force from an all powerful government. With over a dozen different languages spoken and as many ethnic groups, China is hardly cohesive. The push towards democracy could mean a disintegration of China into numerous political entities. It’s not likely that Tibetans, given a choice, would freely choose to remain part of this empire, nor would the numerous other groups such as the Turkic Uighur or Mongolians. Though condemned by Westerners and pro-democracy groups, China’s clampdown on political dissent has been necessary to sustain its existence. Against the current popular mantra, we find that diversity is not a strength, unity is. If China is to achieve the lofty goals of world dominance that so many expect of them, they cannot do it if fractured into pieces. This will mean a continued rule by an authoritarian one party system and in turn we’ll find ourselves having to deal with a regime that has little interest in the will of people. Only China’s current lack of power is preventing it from acting on its claims of Taiwan and the territory of the South China Sea. With Europe already a neutered shadow of it’s former glory, only the U.S. has the strength to prevent it from doing so. As America begins to implode from bad management and unsustainable expenditures, we’ll see the political will to stand up to one of our prime lenders start to vaporize. Many will find the new Chinese superpower to be not as benevolent as the U.S.

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13 thoughts on “The Rise of China

  1. I think that a large-scale colonization of portions of Africa will come very soon for the Chinese.

    In my mind, trying to invade or dominate Laos, Cambodia or Burma would be a waste of time considering their large amounts of rocky terrain and relative isolation as well as the possibility for their battle-hardened natives to engage in guerilla warfare against the Chinese. Even their Tibetan occupation doesn’t necessarily make a whole lot of economic sense for the Chinese.

    However, in Africa the Chinese could buy off a few influential natives and have a free hand to conduct farming and resource extraction with almost no organized resistance. Of course, all of the African natives in the region will flock towards Chinese cities and it will be apartheid all over again, in the same way that the African natives followed the Boers like children as they explored settled previously unoccupied parts of the southern cape.

  2. The Chinese are long term planners and have invested billions into Africa. I agree that China will ramp up colonization efforts into the continent. I don’t think that they’ll engage in direct control at first, but instead buy influence and protection, as you said. They’ll use the Mexican invasion method of massive immigration and procreation until they become the majority in some areas. This is what they’ve been doing with the ethnic minority regions in China to solidify their control. A big part of the Uighur/Han conflict that happened recently was a result of this policy.

    It’s hard to predict the course of actions that China would take if they eventually did become the world’s top superpower. Many see the days of imperialism behind us, but it was the normal course for most nations during the majority of our history. A great deal of China’s territory today exists because of imperialist expansion. It’s not so hard for me to imagine China spreading outwards when I see that half their territory isn’t even ethnically Chinese.

  3. Sagat-

    Welcome back. I didn’t realize you were writing again. I think your analysis is so well done that I can’t add a whole lot to it. I only have this one tangential thought.

    Between China and India you have about 3 billion people entering the global economy. And there are a couple of smaller populations coming online as well ie Brazil and Russia. As work is outsourced their wages will go up and ours will go down until a new equilibrium emerges. But I’m not sure you can bring 3 billion people online and achieve a “western standard of living”. Either there or here. And trying to maintain the old standard of living through government programs or borrowing will ultimately break the bank. I think we’re starting to see a taste of that now. We’ll have to wait for new technology before we see everyone with a “western standard of living”. I think we’ll see that technology in our lives. But it will take a while.

  4. Fred,

    Yeah, I agree with your point that it’s just not possible for so many large nations to all live first world lifestyles. It’s a balancing act. China was able to rise so fast because of it’s vast pool of cheap and efficient labor, and Americans enjoyed a higher standard of living by importing low priced Chinese goods. The thing with China is that they have so many people that they’ll be an ideal place for industry for the foreseeable future. Many predicted that Mexico would get all the manufacturing jobs after NAFTA, but American businesses preferred China, despite the fact that China is so much further away. They simply have a better and cheaper workforce with an able, educated class to manage operations. Other poor third world countries could never do what China did, because they just don’t have the human capital.

  5. “We’ll have to wait for new technology before we see everyone with a “western standard of living”. I think we’ll see that technology in our lives. But it will take a while.”

    This is what i usually feel and sense to be true at the point where i’ve pushed my grasp of economics to its rather humble extreme — but i wonder: what form of ‘innovation’ do you think will do the trick? (back in the ’90s, i thought biotech was NBT, but now most say that was hype, etc.)

  6. Sagat-

    I was involved with several companies who outsourced production lines to Mexico and China. Based on my observations, a lot of the production lines that went to Mexico eventually returned to the original plants in America. But when a production line went to China it was gone for good. The difference was basically that Mexican plants couldn’t turn out a quality product in a timely fashion and the Chinese plants could.

    ===========

    Nikcrit-

    Energy.

  7. “The current political boundaries of the nation are the result of centuries of warfare and political consolidation, with China being a long lived empire that imposed rule on a patchwork of disparate peoples. Even among the Han, there is large cultural, linguistic and genetic differences. The northern Chinese are more similar genetically to other northern Asians like the Koreans than they are to their own southern countrymen. Should we expect a genetically diverse people to have similar average IQs?”

    Sagat,

    I think your overestimate the diversity. Han make up 91% of the population and there is significant genetic homogeneity between Han sub-groups (the average FST value is .003 compared to the inter-European FST value of .009 — so they are at least less diverse than European people.) Many other minority groups are rather ethnoracially close to the Han, for example the Hui (Muslim Han). Refer below.

    Generally, I also think that you overestimate the cultural differences — and the government has pretty much taken care of the linguistic one — at least amongst the Han. In Hong Kong and much of Canton, schools now only teach English and Mandarin.

    I guess it depends on what you are using as your measure. If we take the West, the last dominant civilization, there is much less genetic, cultural, and linguistic diversity across China. Ditto with modern India. And now the modern US.

    “Han Chinese, the largest ethnic group in the world, composing 20% of the entire global human population, is largely underrepresented in such studies. A well-recognized challenge is the fact that population structure can cause spurious associations in GWAS. In this study, we examined population substructures in a diverse set of over 1700 Han Chinese samples collected from 26 regions across China, each genotyped at ∼160K single-nucleotide polymorphisms (SNPs). Our results showed that the Han Chinese population is intricately substructured, with the main observed clusters corresponding roughly to northern Han, central Han, and southern Han. However, simulated case-control studies showed that genetic differentiation among these clusters, although very small (FST = 0.0002 ∼0.0009), is sufficient to lead to an inflated rate of false-positive results even when the sample size is moderate.”

    Genomic Dissection of Population Substructure of Han Chinese and Its Implication in Association Studies
    http://www.cell.com/AJHG/abstract/S0002-9297(09)00470-4

  8. “This will mean a continued rule by an authoritarian one party system and in turn we’ll find ourselves having to deal with a regime that has little interest in the will of people. ”

    I guess I would ask: How is a Han elite not listening to the will of Tibetan people, but looking out for the good of Han people (if that’s what they are doing), different from a Jewish-progressive elite not listening to the will of European peoples, but looking out for the good of minority-progressive people (if that’s what they are doing)?

    Isn’t the will of the people what Western elite don’t want to listen to, lest it supposedly lead to populist illiberalism. Take this article:

    “Neo-nationalism threatens Europe”
    The European project was inspired by the injunction “never again”. Never again would European nations allow virulent and competitive nationalism to tear them apart as they had done in two disastrous wars. Never again would the fate of minorities be left to national parliaments, and racist and populist sentiments”
    http://www.realclearworld.com/2010/09/07/neo-nationalism_threatens_europe_114994.html

    China’s original argument against Tibet — was that they were liberating it from a feudal theocracy. So we could have:

    “Neo-nationalism threatens China”
    The Chinese project was inspired by the injunction “never again”. Never again would Chinese populations allow atavistic and repressive feudal-theocracy oppress them as they had done in just two generations ago. Never again would the fate of the poor be left to autonomous religious leaders, and oppressive and patriarchal sentiments”

  9. Intra-Han and Intra-European Fst’s

    Chuck, I presume that you’re getting “.003 compared to … .009” from the Xu et al. paper linked to in your second-to-last comment: the average of genetic differences between Han Chinese population samples (FST: 0.002) was much lower than that among European populations (FST: 0.009). Arguing that, from this basis, intra-Han differentiation is insignificant would be unwise for a number of reasons.

    If we trace our way back through the Genomic Dissection paper’s references, we’ll see that 0.009 comes from a 2008 paper on genome-wide analysis of East/West Eurasian admixture in Uyghurs. What set of European populations did they analyze? Basque, Sardinian, Italian, Tuscan, French, Orcadian, Adygei, Russian, and CEU (Hapmap Utah Euro-Americans). In most conceptions of Europe, the Adygei (Circassians from the North Caucasus) are pretty peripheral, and, if you look at the Fst table, it’s pretty clear that their inclusion is driving up the intra-European value. (The same’s true of insular outliers like the Sardinians).

    Let’s set aside “continental” averages for now, then, and look at a handful of pairwise Fst values. From the latter paper: Uyghur-Han: 0.0340; Japanese-Han (N. China): 0.0066; Italian-Russian: 0.0088; French-Adygei: 0.0091.

    Nelis et al. (2009), sampling much more extensively within Europe, give the following: France-Hungary: 0.001; France-Sweden: 0.002; France-Poland: 0.003; France-Russia: 0.005.

    Compare those with these average Fst’s from the 350k SNP study by Chen et al. (2009): North-Central: 0.001016; North-South: 0.002236; South-Central: 0.001520; North-Guangdong-Cantonese: 0.003952.

    Regional IQ Variation in Han China

    Sagat’s right to wonder … certain regions’ historic preeminence in the imperial exams (see Jiangnan) may be instructive here. At the same time, assumptions predicated on relative similarity to Koreans or Laotians can easily lead one astray; the Chinese formulation has generally been one of clever southerners and tougher but somewhat duller northerners. Finer-scaled factors like the role of urban centers (especially administrative hubs) in concentrating talent really can’t be overlooked either.

    At Any Rate…

    In closing, Lothrop Stoddard’s maxim bears repeating: practical politics are thus conditioned, not by what men really are, but by what they think they are.

  10. Ortu Kan,

    “In closing, Lothrop Stoddard’s maxim bears repeating: practical politics are thus conditioned, not by what men really are, but by what they think they are.”

    My comment about the relative homogeneity of the Han people was in reference Sagat’s point about IQ, not his point about ethnohistoric cohesion. Perhaps, I should have made myself clearer. I was specifically referring to this point: “One of the factors behind the assertion that China will reign supreme is the belief in the population’s high median IQs. Most of this belief stems from the high IQs and high tech economies of other East Asian countries, but China covers an area so large that the East Asian categorization is an oversimplification. The current political boundaries of the nation are the result of centuries of warfare and political consolidation, with China being a long lived empire that imposed rule on a patchwork of disparate peoples.” With regards to this point the issue of genetic homogeneity is important. For example, while I am generally hesitant in making claims about the population genetics of IQ, I would be even more so, If I knew the population was rather genetically diverse. For example ‘Asians’ or ‘Africans.’

    In general, while I think genetic similarity can foster some cohesion, I don’t put too much weight on it. (But I do put some). Group cohesion in my view is largely brought about culturally, which may or may not mimic genetic relatedness. Modern Religion is an obvious examples of this. Race, of course, in the classical sense of ancestry, is important, but as I see it, this is because ancestry implies shared cultural history, identity, world-view, language and mythos — and other mystical ties. Not so much because of, say, dispositions as predicted by Genetic Similarity Theory or meditations on Ethnic Genetic interest.

    On the point of ethnohistoric cohesion, I think Sagat is mistaken. I have liven in the PRC for a few years and the people seem fairly ethnohistorically homogeneous. The government has done a good job in that department.

    “In most conceptions of Europe, the Adygei (Circassians from the North Caucasus) are pretty peripheral, and, if you look at the Fst table, it’s pretty clear that their inclusion is driving up the intra-European value.”

    I agree with the content of you’re point. If we exclude a few outlier populations, we will find that Europeans are more genetically homogeneous. I used .009, since I have seen it used in the literature. I’ll look for the article. Regardless, my point still stands. With an average FST of .003, Han are rather genetically homogeneous. That’s roughly the difference between the CEU sample, used as an index for Europeans, and the Spanish, polish, and Russian sample. As such, it makes as much sense to talk about an average White/European IQ as it does an average Han IQ.

    “Sagat’s right to wonder … certain regions’ historic preeminence in the imperial exams (see Jiangnan) may be instructive here. At the same time, assumptions predicated on relative similarity to Koreans or Laotians can easily lead one astray; the Chinese formulation has generally been one of clever southerners and tougher but somewhat duller northerners”

    Ok, I see what you’re saying. If Sagat’s model for IQ differentiation is based on multilevel selection (cultural selection), those differences would be important. I was under the impression that he was thinking in terms of Lynn’s model, which is based on large scale factors.

    See Templer (2010), for a quick review of this: http://docs.google.com/viewer?a=v&q=cache:IJfb-zjjt4YJ:xa.yimg.com/kq/groups/1292538/998768009/name/Templer%2BReply%2Bto%2BWicherts.pdf+seeing+the+trees+but+not+the+forest+IQ&hl=en&gl=us&pid=bl&srcid=ADGEESgX3knn46m9xYoJbltnRKHE6uqG8umELLRGKGkLfV-mxDdYozpGL04LbPbvz4uUKrlU2DSujoLJyFbI_4quravgjeH0vc5j8LBKvwF-CASVzibUrDy_zgm135fjs9f7iCJHHc-H&sig=AHIEtbSxkLRJrw0jTj2eUnlQe8W4YBdtuA

  11. Chuck,

    I’ve seen that study you posted before and it conflicts with other population studies that show northern Chinese being more similar to other northeastern Asians, while southern Chinese being more similar to southeast Asians. Looking at the phenotypical differences, I’m more apt to think that’s the case. I’ve seen another study that showed that there’s a general similarity in Han because of male gene flow, but I’m doubtful of these types of studies that look only at mtDNA or just the Y-chromosome markers since those don’t represent the totality of a person’s genetic makeup.

    Regarding IQ, I don’t think there’s been a large scale study about China that’s been published, so my questioning of the consistency of China’s IQ was just that – a question. It may be that the variance is small, so Lynn’s estimate of 100 may hold true. That’d be a good average for a population so large. I think that some of the minority populations might pull it down a little further, but I’m only guessing.

  12. do you really think people in northeast china near korea have the same average IQ as chinese from western china?

    why? just because they are both asian-looking? because they are from the same single country?

  13. do you really think people in northeast china near korea have the same average IQ as chinese from western china?

    No. I already stated that I didn’t. The country itself will have an average IQ, but different regions will have their own average IQs as well. This is true every place in the world. Cities and industrialized areas tend to have average IQs higher than rural areas. Whether the northeastern Han have a higher IQ than southern Han remains to be seen. I would think that the northern Han, being more genetically similar to Koreans, would have higher IQs since Koreans are some of the smartest people in the world. I think the industrialization of the southern coastal areas has skewed the perception though, leading many to think that southern Chinese are smarter.

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