The New Middle Class in China

Consumption, Politics and the Market Economy

E. Tsang

• Publisher: Palgrave Macmillan
• Year: 2014
• Print ISBN: 9781349346455, 9780230354449
• eBook ISBN: 9781137297440
• Topic: Social Sciences
• Subtopic: Marketing
• Index: Marketing

Based on interviews with entrepreneurs, professionals and regional party cadres' from a range of age groups, this book argues that Western class categories do not directly apply to China and that the Chinese new middle class is distinguished more by socio-cultural than by economic factors.

1

(Re) Framing Class Theories: Class Analysis in Post-Reform China

…China’s new middle class is a term without a single identifiable social interest or propensity to action. It encompasses not only the owners of capital, but also the managers and bureaucrats, as well as the professionals who service and support capitalist entrepreneurs and the modernizing state…

(Robinson & Goodman 1996: 40)

The model of traditional class theories in the West is not completely appropriate for conducting a class analysis of contemporary Chinese society. I argue that Western class categories are not directly applicable to the Chinese situation and that the Chinese new middle class is distinguished more by sociocultural than by economic factors. The Chinese new middle class is more diversified and heterogeneous than it appeared at first. The cultural and social identification of the Chinese new middle class operates mainly through cultural practices and consumption patterns. Hukou creates spatially distributed inequality. Danwei continues to be significant in considering class and class distinction in urban China. Both hukou and danwei create differences in work situations by forming guanxi networks inside the boundaries of the new class. This explains why hukou and danwei manifest themselves in sociocultural rather than economic differences. Significant effects on the new class also come from institutional changes in the framework of property ownership and the dominant role of the cadre in society. Therefore, ‘class’ in the Chinese context is a relatively sociocultural term rather than solely an economic one.

In this chapter, I shall reframe the class analysis by reviewing how Western class theories are not applicable in the emerging Chinese new middle class in today’s China. First, I shall examine the Marxist theory on class and how Marxist principles deal with questions about stratification orders within a modern society. Second, I will use cultural capital and ‘party’ (political determinism) from Weberian class analysis but I note that political determinism works in different ways in China from the way it does in the West: political affiliation/support for the CCP (China) vs. political parties competing for power in the public realm (West). I will also use ‘economic class’ from Weberian class analysis because it seems to work in a more refined (or less blunt) way than in Marxist class theory. Third, I will develop Weberian ‘economic class’ in terms of ‘work situation’ and ‘market situation’ drawing on the work of neo-Weberians such as John Goldthorpe (1980, 1982), whose seven-class scheme is more easily modifiable to the Chinese situation. Finally, I shall also seek to supplement the neo-Weberian approach with the approach adopted by Bourdieu and the work of other cultural sociologists to explain some of the lifestyle and consumption patterns of the Chinese new middle class.

The second part of this chapter will explain how the established theoretical models help to operationalise a conceptual framework of class for this study using concrete scenarios to depict the actual situation in today’s China. The Chinese new middle class is emerging in ways that depart from the standard development pathways proposed by Western mainstream theories about the middle class. The political and economic realities of ‘socialism with Chinese characteristics’ are so unique that they have no direct parallel elsewhere, so they impart correspondingly unique characteristics to the Chinese new middle class. The advent of a new class in a modern, part-socialist/part-capitalist society like that of China is a sign that market, class and political intervention are important, but their forms are different from those in the West (Anagnost 2008).

I will begin by enumerating some special considerations that pertain to the Chinese case:

1. Generational stratification, family norms, value changes, parent–child relationships and marriage patterns detected in Chinese society today are markedly different from those in Western societies.
2. Occupational types in the Chinese case also tend to overlap one another or even encompass all possible categories, especially in the case of those categories associated with the new middle class. For example, a single individual may straddle two or even all three of what I shall argue as the primary categories of cadre, entrepreneur and professional.
3. Some institutional systems of China have no parallel in the West. For example, workers outside the hukou and danwei systems do not have the same or even comparable contractual positions as those inside them.
4. The culture and social identification of the Chinese new middle class operates mainly through cultural practices and consumption patterns. This is unlike the Western middle class, which operates through patterns of social stratification (Goodman 1999, 2008; Li 2010).

The inapplicability of Western class analysis

Classical Marxist class theory is a theory that rests on notions of class antagonisms and struggles. It involves two dichotomous classes in a state of continual conflict because of one class exploiting the other. Class exists in society when there is an exploitation relationship in production, which, under capitalism, in Marxist theory is between the bourgeoisie and the working class. As capitalism progresses, the gulf widens between the bourgeoisie and the working class, and becomes ever deeper and more distinct with time. Marxist theory bases its argument on ownership and lack of ownership of property in the means of production as being the essential determinant of class relationships.

The class debate in the West is framed primarily in terms of a debate about Marx’s theories. The Marxist analysis of class and society is best able to account for socioeconomic phenomena, but even here Marxist concepts break down when dealing with modern capitalist societies (Clark & Lipset 2004; Meiksins 1998; Migone 2007). The weakest point in Marxist thinking, even for the analysis of Western capitalist societies, is the conspicuous absence of intermediate classes between workers and bourgeois capitalists. In a capitalist society, according to the Marxist argument, the bourgeoisie consists of industrialists, financiers, landowners and merchants. They are in continual conflict with each other and they as a whole are in opposition against workers. The real-life problem for Marxist theory is that all societies around the world have undergone major transformations since the theory was first developed more than a hundred years ago. Class lines are relatively blurred in present-day China. The theory is unable to deal with groups like managers, civil servants, doctors, computer programmers and many others who are salaried but own no means of production, at least as defined in Marxist theory (Saunders 1990: 15). Neo-Marxists such as Nicos Poulantzas (1973, 1975, 1978, 1982) and even C. Wright Mills (1979, 1985a, 1985b, 1994, 1997) and Wright et al. (1999) tried to compensate for theoretical problems by reclassifying the modern middle class as the petty bourgeoisie of small business owners, independent farmers and white-collar salaried workers. The reclassified middle class is then situated between the financiers and industrialists on the one hand and the industrial workers on the other (Arbam 1989: 332), but the theory cannot escape the shrinking role of the latter and the declining significance of class polarisation, at least in terms of class structure.

The Marxist class theory, then, has quite deep-seated problems and reclassification sounds like a stopgap measure. Numerous studies have confirmed that no existing communist state has ever existed in pure communist, classless form (and that the only classless societies that have existed, in Marx’s sense, are those of ‘primitive’ communism, not ‘advanced’ communism). Indeed, Marxist theory could not even offer a sustainable explanation of European feudal societies. In mediaeval Europe, the cleavages and conflicts in society were not between owners and non-owners of assets of production. They were mostly between the monarch and the nobility or the church, or between the crown and the burghers in townships that tried to assert autonomy from royal control, or just blood feuds (Saunders 1990: 12). We can see that the two concepts of exploitation and class structure are already too limited to explain feudal societies. The fact is that all societies are always progressing under various degrees or types of transformations. The Marxist theory uses class categories like property and means of ownership to classify class in society. That makes most Marxist-based class theories of decreasing relevance for examining modern-day class structures and class relationships.

If Marxist theory has lost its utility for analysing Western societies, it has even less appropriateness for explaining the new patterns of social stratification that are now emerging in China. The Chinese case introduces problems – it is a retrogressive transition, from state socialism to market socialism (capitalism). The Chinese transition complicates the Marxist analysis by including a trajectory not recognised by Marx. The class philosophy, historical materialism and the two-class dichotomy of Marxist theory are legacy conceptualisations for China watchers. Today’s China is a mixture of socialism and capitalism with spatial characteristics. So, confronted with a problematic transition, Marxist theory, as a theory of transition, is generally implausible when applied to the Chinese new middle class in today’s China.

Weberian class analysis

Long-standing attempts by sociologists to understand modern capitalism in terms of class usually begin with Marxist theories but have moved in a Weberian direction because of complications presented by real-life situations. Max Weber’s (1946, 1947, 1951) pioneering work in class analysis takes up the slack in Marxist thinking on two levels. On one level, Weberian class analysis breaks the Marxist materialist link between class and the economic/productive process by showing that people are also consumers of goods and services in the marketplace and not just sellers of labour (workers) or owners of capital (the capitalist elite) (Liechty 2003: 11).

Weber developed a typology of class, status and party as the key bases of social stratification. He considered them as important influences in people’s lives, as opposed to the Marxist emphasis on property classes alone. That means that the Weberian approach looks at the underlying structure of class as differential sets of life chances for members. Differential demand in the marketplace for capital, commodities and labour represents differential property ownership and income opportunities, which in turn give rise to differential life chances. Differential life chances create differential demands for goods and services, and differential access to them. All these make Weberian class analysis more of a consumption-based model of class than a production-based one, or at least, allow a production-based account to be supplemented by a consumption-oriented one (Wallace & Wolf 2006; Ashley & Orenstein 2005).

If capital accounting predominates in modern Western capitalism, then Weber was right to make a distinction between property classes and acquisition classes. Property classes are established on the disparity of property holdings, whereas acquisition classes reflect the possession of skills that help secure resources in the market, thus enabling the Weberian approach to accommodate intermediate divisions. In Weberian thinking, then, social class or group formation rests on (1) ownership of the means of production, (2) economic or market position of an individual’s skills and other marketable qualifications such as education (both of these are usually associated with the Weberian definition), (3) social prestige or honour (status) accorded to an individual by others, and (4) group belonging (party).

Class

In Weberian thinking, classes derive their existence from economic situations associated with property holdings and positions in the labour market. Currently, neo-Weberian class conceptualisations articulate class positions primarily in terms of market and work situations.

Weberians agree with Marxists that all class divisions are based on property holding, but differ in two important respects. Class is (a) a set of people with a common, actual and specific component in their life chances, insofar as (b) the common life-chance component is represented exclusively as economic interests by possession of goods and income opportunities, and under the conditions of the commodity or labour market (Ashley & Orenstein 2005: 234).

Let us consider that for a moment. Based on property divisions, then, Weberians would identify the propertied classes as property-owning entrepreneurial groups and the petty bourgeoisie. Groups that are non-propertied but possess formal educational credentials are distinguished from manual workers (Breen & Rottman 1995: 28). As a set of people who share common life chances, the market provides the common condition for the decisive moment when a life chance appears to the individual. Weber said that the market distributes life chances in proportion to the resources that individuals bring to it (Weber 1946, 1947; Breen & Rottman 1995). There is a market variation in these resources (e.g. property owners vs. non-owners, skilled vs. unskilled) (Breen & Rottman 1995: 29). As Weber wrote:

…The factor that creates class is unambiguously economic interest with classes stratified according to their relations to the production and acquisition of goods… (cited in Raynor 1969: 8)

Therefore, class situation is now equivalent to market situation, so the redefinition now reckons that people come to the commodity, credit and labour markets in unequal fashion (Breen & Rottman 1995: 28). Class becomes redefined in terms of resources held by or resources accessible to individuals instead of the relative place of the individuals in the production process.

Status

Status alludes to prestige or reputation differences between social groups. It also concerns the prestige and lifestyle of the individual and the social estimation attached to them, which means status distinctions could vary independently of class divisions. Social honour may be positive or negative. For example, doctors and lawyers are positively privileged status groups in modern capitalist society, but Jews were a pariah group in mediaeval Europe and banned from certain occupations and official positions.

The possession of wealth normally confers high status, though there are exceptions. Weber (1946, 1947) believed that members of a status group share a common claim to a certain level of social prestige based on lifestyle, education or occupation. Status situation could be a highly important factor in that it may have a direct bearing on class situation for individuals.

On the one hand, social status relates to individual or group lifestyle, education, training and socialisation as well as inherited or occupational prestige. On the other, class distinctions are linked in various ways with status distinctions. As such, property is not necessarily recognised as a status qualification, although in the long run it is and with extraordinary regularity (Weber 1946: 186–7; Liechty 2003: 14).

The Weberian analysis provides useful insights into how consumption and status could be related to the dynamics of middle-class cultural practices (Liechty 2003: 11). The rationale is that sociocultural processes in Weber’s intermediate stratum (i.e. middle class) revolve around the wide range of cultural formations, lifestyles and status claims, and how they compete with one another within those stratums. For Weber, class is the position of an individual or a group in the market as a function both of production (capitalist vs. labour) and of capability to consume goods and services. This means the social order of the middle class is determined relatively less directly by its relationship to the means of production but relatively more ...

Table of contents

• Cover
• Title
• Copyright
• Contents
• List of Figure and Tables
• Preface
• Acknowledgements
• Introduction: China Engages a Middle-Class Society in the 21st Century?
• Chapter 1 (Re) Framing Class Theories: Class Analysis in Post-Reform China
• Chapter 2 Class Boundaries of the Old Generation of the Chinese New Middle Class
• Chapter 3 Generational Effects in the Chinese New Middle Class
• Chapter 4 Guanxi Networks and the Chinese New Middle Class
• Chapter 5 Class Formation and Political Development
• Conclusion: A China in the Making with a New Middle Class?
• Appendices
• Notes
• Bibliography and Citations
• Index