Since the implementation of capitalist reforms in the 1970s, China's gross domestic product has increased by an average of 9.5 percent each year. This growth is expected to continue at this breakneck pace, and China is expected to overtake the United States as the world's largest economy by 2026 (Ding 6). This influx of wealth catalyzed advances in Chinese technology, enabled greater access to education for millions, and increased the overall standard of living for more than a billion people. However, capitalism has brought disadvantages to both the Chinese people and the nation as a whole. The Chinese people still lack many basic freedoms, workers' rights are often violated, government corruption is rampant, and the environment is more damaged than before. As capitalism has both advantages and disadvantages, it is questionable whether it has an overall positive effect on China. To better understand the current influence of capitalism in China, it is necessary to have both a basic knowledge of the communist system that preceded it, as well as an understanding of the nature of Chinese economic reform, which started in 1978. In 1949, Mao Zedong, the leader of the Chinese Communist Party, defeated his longtime rival Chiang Kai-shek and established the People's Republic of China. After taking power, Mao began rebuilding China, a country devastated by both civil war and World War II. Mao's first major policy was the Great Leap Forward, which imposed both collective farming and rapid industrialization. Mao's second major policy was the Cultural Revolution, which sought to promote communism in China and eliminate foreign ideological influence. Both policies were horribly unsuccessful,...... middle of paper...... 2014. Thibodeau, Patrick. “The United States could fall behind China in R&D spending by 2023.” Computer world. Computerworld Inc., January 14, 2013. Web. April 6, 2014. Wang, Ying and Lulu Zhou. “The Harvard Crimson.” From Asia with Love. Crimson Staff Writers, December 7, 2006. Web. April 6, 2014. Wong, Edward. “As pollution worsens in China, solutions succumb to infighting.” The New York Times. The New York Times, March 21, 2013. Web. April 10, 2014. Wong, Edward. “The cost of environmental damage in China is rising rapidly amid industrialization.” The New York Times. The New York Times, March 29, 2013. Web. April 9, 2014. Xuecun, Murong. “No road is straight here.” The New York Times. The New York Times, May 7, 2012. Web. April 8, 2014. Yeung, Henry Wai-Chung. Chinese capitalism in the era of globalization: towards a hybrid capitalism. New York: Routledge, 2004. Questia School. Internet. February 28. 2014.