"In fact, the occurrence of favorable unintended consequences (the Smith-Menger-Hayek case) also has some parallels in the field of economic planning in China, though for that we have to look at other parts of recent Chinese history. As the fast economic progress of East Asian and Southeast Asian economies gets more fully analyzed, it is becoming increasingly clear that it is not only the openness of the economies—and greater reliance on domestic and international trade—that led to such rapid economic transition in these economies. The groundwork was laid also by positive social changes, such as land reforms, the spread of education and literacy and better health care. What we are looking at here is not so much the social consequences of economic reforms, but the economic consequences of social reforms. The market economy flourishes on the foundations of such social development. As India has been lately recognizing, lack of social development can quite severely hold up the reach of economic development. When and how did these social changes occur in China? The main thrust of these social changes was in the pre-reform period, before 1979—indeed a lot of it during the active days of Maoist policy. Was Mao intending to build the social foundations of a market economy and capitalist expansion (as he certainly did succeed in doing)? That hypothesis would be hard to entertain. And yet the Maoist policies of land reform, expansion of literacy, enlargement of public health care and so on had a very favorable effect on economic growth in post-reform China. The extent to which post-reform China draws on the results achieved in pre-reform China needs greater recognition. The positive unintended consequences are important here. Since Mao did not consider seriously the likelihood that a flourishing market economy would emerge in China, it is not surprising that he did not consider this particular entailment of the social changes that were being brought in under his leadership. And yet there is a general connection here that is quite close to the focus on capability in this work. The social changes under consideration (expansion of literacy, basic health care, and land reform) do enhance human capability to lead worthwhile and less vulnerable lives. But these capabilities are also associated with improving the productivity and employability of the people involved (expanding what is called their “human capital”). The interdependence between human capability in general and human capital in particular could be seen as being reasonably predictable. While it may not have been any part of Mao’s intention to make things easier for market-based economic expansion in China, a social analyst should have been well placed—even then—to predict just such a relationship. Anticipation of such social relations and causal connections helps us to reason sensibly about social organization and about possible lines of social change and progress."