In order to evaluate the contribution of the post-1978 reforms, we construct a counterfactual where Mao’s policies ... continued in the post-1978 period. We find that reforms were very successful. Compared with the continuation of Mao’s policies, reforms generated an additional 4.2 percentage points of annual GDP growth and a 23.9 percentage point decrease in the share of labour force in agriculture. Without reforms, China’s GDP per capita would have been $2,536 rather than $10,274 (both numbers are in terms of 2012 PPP US dollars), and the share of labour force in agriculture would have been 57% rather than 33%.Our bold (because a four-fold increase deserves to be highlighted) in the above. But, it would have been even better had less of the state remained in place;
... we further analyse the factors behind growth of non-agricultural total factor productivity by dividing this sector into state and non-state firms following Brandt et al. (2008). We confirm their finding that the growth of productivity in the non-state firms and reallocation of labour and capital from state-owned enterprises are responsible for the bulk of growth of non-agricultural total factor productivity.Let's hear that again;
...we do not find any evidence that state capitalism is responsible for growth in China. We show that the growth rate of total factor productivity in the state non-agricultural sector was the same post-1978 as in Mao’s era. Rather, non-state total factor productivity growth, relocation of labour and capital from the state to the non-state sector, and the reduction of consumption and production distortions explain virtually all (that is, nearly 100%) of the growth and structural transformation in China.Everything (or most things) without the state did well.