Janos Kornai understood capitalism by studying its opposite

IN HIS CABIN aboard the SS Bashan, a luxury river boat sailing to Wuhan, Janos Kornai was sleepless with excitement. The Hungarian economist, who died last month, was one of seven foreign experts invited in 1985 to share their views on China’s economic reforms. As Julian Gewirtz recounts in his book “Unlikely Partners”, Mr Kornai stole the show. On a week-long cruise with an audience of Chinese technocrats, he dissected socialism’s familiar “cares and woes” (featherbedded firms, rushed growth and consumer shortages). And he offered a hopeful vision of a restrained, guided capitalism. His book “Economics of Shortage” soon became a bestseller in China, although he never saw any royalties.