China’s Export-Led Growth Model: Structure, Impact, and Strategic Implications for the Global Economy

Abstract

The analysis explores how China’s policies have both benefited and destabilized the U.S. economy, from consumer price deflation to deindustrialization and financial dependency. The paper situates these developments within the framework of international economics and interrogates their implications for Modern Monetary Theory (MMT), highlighting the paradoxes of fiscal sovereignty under global capital interdependence. It further examines the U.S. policy response, including tariff escalation and strategic decoupling, and extends the discussion to include military and geopolitical dimensions—most notably, tensions surrounding Taiwan and the South China Sea. The paper concludes that both nations face structural transitions that demand strategic recalibration. For the United States, this includes industrial revitalization and policy coherence; for China, a shift toward consumption-led, innovation-driven growth. Absent mutual accommodation, the risk of economic disruption and unintended conflict remains significant. The paper ultimately advocates for a more balanced, resilient, and cooperative global trading framework capable of addressing economic, technological, and security challenges in a multipolar world.

Keywords

• modern monetary theory
• socialist market economy
• monetary sovereignty