Chinese economists called for institutional reforms after three US-based scholars won the Nobel Prize in economics with their research into how institutions shape the economic success of nations.

They argued that states with “inclusive institutions” – which uphold the rule of law and property rights – as opposed to “extractive ones,” would lead to “inclusive” economic institutions and economic success.

“I think the conclusion of their work tells us that institutions are the most critical [to a country’s economic development]. This also has big implications for China’s way forward,” said prominent Chinese economist Xiang Songzuo, who added that the scholars’ conclusions were applicable to the China model.

“Only by moving towards further marketising our economy, emphasising on the protection of intellectual property, private companies, fair market competition and upholding the spirit of entrepreneurship, can our economy attain sustainable growth, and our people can have higher incomes.”