It is widely accepted that democratization establishes socioeconomic prosperity in most nations. In the People’s Republic of China, when economic crisis galvanized the need for reform after Mao Zedong’s reign, new leaders implemented a socialist-market economy that progressively becomes more ‘market’ and less ‘socialist’ everyday. Several studies have proven that an authoritarian regime and a market economy simply cannot coexist in the same state. As a result, China will gradually continue to implement more democratic policies to appease its new economy and will experience great progress over the next ten years.

Economic reform and political regime shifts are inextricably linked. As seen in the Russian Federation, reform can begin with simple policy changes such as Mikhail Gorbachev’s Perestroika policy, which allowed individual enterprises to establish themselves and decentralization to take root. However, the communist ideals of the government were incompatible with the new globalized market economy, and more democratic reforms were necessary to quell the socioeconomic discord. China now faces a very similar situation with the implementation of its market economy. As citizens – private businessmen and entrepreneurs – gain increasing influence, democracy’s core principle of ‘a rule by the people’ will gradually envelop the nation.

China’s economic reforms have broadened class differences, which is entirely contradictory to the fundamentals of the socialist manifesto, and thus, indicates a political regime shift is in order. Education has spread and the power of individual leaders has been divided. The National People’s Congress in China has been allotted more power in policy-making, and although it is still run in whatever manner the Communist Party dictates, it has successfully divided the power of the head of state. Elections have even begun to take place in rural areas around the country. At the same time, Communist leaders have been loosening control on all facets of free speech and the media, while also allowing differing opinions to be voiced to a minimal but increasing degree. As more progress is made to deteriorate the Communistic core of the nation, China will begin to prosper at its full potential. Clearly, democratization breeds prosperity as is demonstrated by countries such as Mali and Brazil.

As democratization settles into the country, people’s voices will begin to rise. Discontent has already been made clear by oppressed citizens in demonstrations like the Tiananmen Square massacre. China’s role as a member of the United Nations Security Council and the World Trade Organization necessitates international appeasement, and if another incident like the Tiananmen massacre were to occur, China would lose support from top economic actors such as the United States and Great Britain. Economic prosperity would be sacrificed for further totalitarian oppression. Therefore, internal and external pressures will cause China to accept the same fate as its formerly-Soviet neighbor as it fully implements democracy and takes its place as one of the most powerful nations in the world.

As his primary philosophy was based entirely on social politics, Karl Marx developed plans for the economy which led to the widespread philosophy now known as Marxism. Marxism was a strong contrast to the proven and successful economic plan known as Capitalism. Capitalism involves most of the production taking place with employees working for employers with various means of capital and supplies. Marx, on the other hand, considered capitalists “wage-slaves”. As a contrast to this, Neoclassical economics is slightly more appreciative of the success of the capitalist system; it defines economics which focus on a prices, outputs, and income distributions through the laws of supply and demand.