China's Economy: What Everyone Needs to Know

Kroeber, who founded the research firm Gavekal Dragonomics and spent decades analysing the Chinese economy from Beijing, wrote this as a structured introduction organised as questions and answers.

The analytical positions are what distinguish it from a survey. Kroeber argues that China's growth followed the East Asian development model of mobilising resources into investment and export manufacturing, and that this model has known limits: it produces high growth while there is surplus rural labour to absorb and while the capital stock is low, and it reaches diminishing returns as both conditions end. He argues that China reached that point around 2010 and that the subsequent debt growth reflects the effort to sustain investment-led growth past its natural life.

On state and market he rejects both the account that China is a market economy with communist branding and the account that it is a centrally directed system. He describes a structure where the state controls the commanding heights including finance, energy, telecommunications and land, while permitting genuine competition in most consumer and manufacturing sectors, and where local governments compete with each other for growth using land sales and investment vehicles.

On the financial system he explains that the banking system's function is to channel household savings into state-directed investment at suppressed deposit rates, which is a transfer from households to firms and to the state, and that this is what produces both the high investment and the low household consumption share.

He also covers demographics, urbanisation and the household registration system, energy and environment, the currency, and the international position.

The question and answer form limits the depth on any one topic. The book is from 2016 and predates the property sector's contraction, the regulatory intervention and the current growth slowdown, though its analysis anticipated the structural pressures behind all three.