The Transition Path Research From The Perspective Of The Generalized Relevance Of The System

With the advance of the transition practice, theoretical progress has been made on the transition path, but has not yet achieved the desired consensus. Judged from the transition practice in the past two decades, the overall economic performance of the gradual transition is clearly better than the radical transformation. However, the radical transition has gained more theoretical support, how to understand the paradox? The paper argues that the dilemma derives from the relevance of the system and the complementary in the process of the reform. The radicalist adhere to the relevance of the system, insist that the transition from the plan system to the market system only succeeds in the radical way, so they couldn't explain the serious economic recession occurred in the radical transition countries and the economic miracle in the gradual transition countries. Based on the comparison of the transition performance difference between China and Russia, the gradualists made some critiques to the radicalist, but not fundamentally undermined the theoretical basis of the radical transition methodology, so they has not been able to convince the radicalist, but also unable to establish their own theoretical system. The inconsistency between theory and practice is not conducive not only to understand the practice in the past but also to the future development of the transition practice. To this end, the paper establishes the analysis paradigm of the generalized relevance of the system.The generalized relevance of the system consists of the three levels, such as the relevance between the formal system and the environment which the system operates, the relevance between the formal system and the informal system, the relevance between the basic system and the secondary system within the formal system. The countries in transition should improve all the relevance simultaneously, if not, they should strive to get an overall improvement so as to offset the partial loss. Thus, the theoretical basis of the radical transition is very narrow, only concerned about the third relevance, namely, the relevance within the formal system, while ignoring the other two levels. The environment which the system operates and the informal system is different in each country, so is the impact of the strategy of the radical transition on the other two levels, eventually leading to their economic performance difference.The paper will not only demonstrate the theory on the transition path, but also re-interpret the performance difference between China and Russia in transition from the perspective of the generalized relevance of the system.The organization of the paper is as follows. Chapter 1 introduces the significance, perspective, innovation and structure arrangement of the research. Chapter 2 overviews relevant theories on the transition path, with emphasis on the debate between the radical transition and the gradual transition, the dispute over the constitutional transition and the gradual transition, the internal struggle within the gradual transition. Chapter 3 is the core of this article, which not only elaborates the analysis paradigm of the generalized relevance of the system but also demonstrates the perspective of the balance of the system and the basic principles of the transition under the methodology. Chapter 4-5 is the application of the paradigm to Russian and Chinese transition practices, which states the reason of Russian V-type economic growth, explains Chinese economic miracle and reveals some problems arising from the transition. Chapter 6 concludes with some constructing suggests.