China is becoming ever more deeply integrated with global political economy. This book addresses critical issues in this process. The author examines the paradox of the global market economy that is presided over by 70 million members of the Chinese Communist Party, and analyses China's policy of 'innovation in an open environment', attempting to nurture a group of globally competitive, large-scale companies.

In addition, the book analyses the challenges that China's political economy faces in the twenty-first century, identifying the way in which China is attempting to resolve these contradictions by building on its rich historical experience to regulate market forces. It further examines the wider context of global capitalism within which Chinese development is taking place. Capitalism is the key propulsive force in technical progress. The recent period has seen an unprecedented liberation of this force. However, this force is a two-edged sword. The unprecedented advances have come hand-in-hand with unprecedented challenges that threaten the very survival of the human species.

Finally, it studies the relationship between the United States and China. Through cooperative behaviour, the US and China can help lead the world towards a sustainable future for mankind, with a global market economy regulated in the common interest of all human beings. In the absence of such a mechanism, the prospects for humanity are bleak.

Peter Nolan is Sinyi Professor of Chinese Management at the Judge Institute of Management, Cambridge University, and Fellow of Jesus College, Cambridge University. He is a consultant to the Ford Foundation on the Chinese rural economy and also consultant to the State Council of the People's Republic of China. His previous publications include Transforming China: Globalization, Transition and Development (Anthem Press, 2004).