Developing a High-Standard SocialistMarket Economy System: Roots inChinese Civilization

Pei Changhong1, Ni Jiangfei*2

1 Institute of Economics, Chinese Academy of Social Sciences (IE-CASS), Beijing, China

2 National Academy of Innovation Strategy (NAIS), China Association for Science and Technology (CAST), Beijing, China

Abstract: China’s remarkable economic and social achievements since 1978 are largelyattributed to the socialist market economy system, a pioneering institutional designestablished during the reform and opening-up period. Far from being a tree without rootsor water without source, this system is deeply embedded in the fertile soil of Chinesecivilization. It inherits and builds upon the wisdom of Chinese civilization—embodyingproto-socialist ideals such as “Great Harmony under Heaven” and “People as theFoundation of the State”—while integrating Marxist theory to forge a distinct Chineseinstitutional identity. This synthesis has given rise to a new form of human economiccivilization. As a critical component of constructing a high-standard socialist marketeconomy system, the refinement of its foundational institutions should draw on the valuesof Chinese civilization, steering its development toward the law-based governance, globalintegration, and modernization, and providing important institutional assurances forChinese modernization..

Keywords: Socialist market economy system; foundational institutions for market

JEL Classification Codes: B24; P30; Z13

DOI: 10.19602/j.chinaeconomist.2025.05.02