Maria Sfondrini, 2501213951
Painting the World: How Dafen Village Helps Explain
China's Rise as a Global Supply-Chain Hub
Introduction
Located in southern China, Shenzhen saw the emergence of the largest cluster of hand-painted oil paintings
worldwide in Dafen Village. At its peak, before the 2008 financial crisis, Dafen is estimated to have produced
about 60% of the world's oil paintings. Most were copies of recognizable Western masterpieces such as Vincent
van Gogh’s Sunflowers, Leonardo da Vinci's Mona Lisa, or Claude Monet’s Water Lilies (Wong, 2013; Chen
and Qi, 2021). The village hosted between 8,000 and 10,000 migrant workers who lived and worked in tiny
workshops, each with a specific task, such as painting the sky, portraits, or landscapes.
In practice, the system was an assembly line for art.
The purpose of this essay is to show that Dafen Village can be used as a lens through which to consider a
broader question: how has China become the most important supply-chain hub in the world in just three
decades? While many factors contributed to this growth, I would argue that two main forces, when combined,
proved decisive: (1) deep integration with global markets driven by external demand; and (2) pragmatic
industrial policies implemented at various layers of governance. Dafen Village is a microcosm of how these two
forces worked together. Its initial rise was driven by Hong Kong traders selling the product abroad; its growth
was then boosted by local concentration effects and, later, by direct support from Shenzhen's municipal
authorities. The post-2008 crisis highlighted the risk of dependence on exports and accelerated a shift toward
higher-value-added activities along the value chain.
Outline
This essay is divided into four parts. The first part introduces the analytical framework used. The second part
examines the history of Dafen Village from 1989 to 2008. The third part discusses the development of events
following the global financial crisis. The final section offers some concluding thoughts on what Dafen can
teach us about China and its position in the global supply-chain.
1. Theoretical perspective: a synthesis between integration and industrial policies
When it comes to explaining China's economic rise, authors generally fall into two theoretical camps. On the
one hand, books like Brandt and Rawski's "China's Great Economic Transformation" (2008) focus on the
internal factors that enabled China's success: the gradual implementation of reforms, the arrival of millions of
farmers in the cities to provide labor, competition among cities to offer better services, and performance-based
incentives offered to Communist Party officials. The second camp, which can be called "factor-oriented,"
attributes China's development to external forces. Economists like Gary Gereffi (2009) point to foreign
multinationals, international buyers, and global supply chains as the catalysts that pushed China to improve its
products and increase its connections with the world.
Both theories contain an element of truth, but they are best understood as complementary. Foreign buyers’
demands represent opportunities, which are only useful if a country has the institutions necessary to take
advantage of them. Justin Yifu Lin, former chief economist of the World Bank, attempts to combine these
theories under the heading of New Structural Economics (2014). His central thesis is that industrial policy can
only be successful when the state "selects sectors with factor endowments just one step higher on the learning
curve than those already present in the economy"; but when government authorities choose sectors that are too
advanced compared to the country's standard, this "destroys rather than encourages" growth.
How does this apply to Dafen Village? In the 1980s, hand-painted oil reproductions were perfectly suited to the
southern Chinese market, thanks to the large number of migrants, the geographic proximity to Hong Kong, and
the absence of copyright issues, considering that the original painters had been dead for over a century. The
missing link between production and global demand was filled initially by entrepreneurs and later by the
government.
2. Dafen becomes a global manufacturing hub, 1989-2008
Dafen's story begins in 1989, when Hong Kong entrepreneur Huang Jiang, whose family was originally from
Fujian province, moved about twenty painters to the rural Hakka village on the outskirts of Shenzhen (Wong,
2013; Tinari, 2007). Huang chose the area for at least three reasons: low rents, proximity to Hong Kong, and a
population of migrants from the inland provinces eager to work on a piecework basis. The first products
consisted of hand-painted reproductions that were sent to Hong Kong and then shipped to wholesalers in the
West, to be purchased by hotel chains, furniture stores, and middle-class families for interior decoration.
For about a decade, Dafen grew with almost no government oversight. As an "urban village" (城中村,
chengzhongcun), it had a special administrative status: the land belonged to the original village collective, not
to the city, and many of the usual rules did not fully apply (Li, Cheng, and Wang, 2014).
The artisan workshops formed a sort of assembly line, with painters specialized in the creation of individual
elements: some painted the sky, some faces, some hands or trees. The painters then passed the canvases to their
colleagues along the line. Some workshops produced more than 30,000 paintings per month. By the early
2000s, Dafen was home to over 5,000 migrant painters and 800 art shops, with annual export revenues
exceeding RMB 300 million (Li, Cheng, and Wang, 2014).
Remarkably, government support was reactive to the industry’s success, not proactive. In 2004, Dafen was
officially designated a "National Demonstration Base for Cultural Industries" by the Shenzhen municipal
government, followed by infrastructure investments, the construction of the Dafen Art Museum (opened in
2007), participation in the Shenzhen International Cultural Industries Fair, and increased credit options and tax
breaks for registered artists and galleries (Chen and Qi, 2021).
Thus, in Dafen, as in many other Chinese industrial districts, the state did not initiate the cluster. Rather, it
recognized and amplified something that was already working. The same pattern can be observed in Yiwu, in
the early Shenzhen electronics sector, and in Wenzhou's textile district (Brandt, Ma, and Rawski, 2014).
Industrial policy in China often relies less on top-down planning than on validating and supporting what the
market has already created.
Perhaps the most comprehensive analysis of life in Dafen is offered by Winnie Won Yin Wong in Van Gogh on
Demand: China and the Readymade (University of Chicago Press, 2013). Written after four years of fieldwork
(2006–2010), Wong's book places Dafen at the center as a practical demonstration of her overall thesis: that
Chinese towns force Western observers to question their ideas of “original” versus “copy”, because any work of
art is the product of unseen labor, devalued under Western-defined categories.
For the purposes of this essay, however, the most useful point is the economic one: Dafen painters were neither
heroes nor victims of an unjust system. They were skilled migrant workers operating within a rigidly organized
export chain, whose conditions were dictated by foreign buyers and Hong Kong intermediaries. They captured
only a small portion of the final retail value of their labor.
The 2016 documentary China’s Van Goghs (中国梵高), directed by Yu Haibo and Yu Tianqi Kiki, brings some
humanity to the story. It tells the story of Zhao Xiaoyong, a painter from Hubei who, at the time of filming, had
painted approximately 100,000 copies of Van Gogh's paintings over a period of over twenty years (Yu and Yu,
2016). We see him painting in his studio, going to work, and living with his family. His daily life revolves
around the mass production of copies of copies. In the most evocative sequence, Zhao travels to Amsterdam
for the first time and discovers that the souvenir shop selling "his" paintings outside the Van Gogh Museum
sells them for many times the price he receives. He also visits the museum itself and sees a real Van Gogh for
the first time.
The scene illustrates what academics call the “smile curve” (微笑曲线). First developed by Acer founder Stan
Shih in the 1990s, the concept was later refined by authors writing on global value chains (Gereffi, 2009).
Essentially, design and brand at one end and retail at the other capture most of the value, while manufacturing
in the middle - where Dafen's painters work - captures the least.
3. The 2008 crisis and the push for upgrading
The 2008 global financial crisis represented a turning point for Dafen, as well as for much of China's
export-oriented manufacturing. Before 2008, approximately 80% of Dafen's paintings were exported, primarily
to Western markets (Arnold, 2017; 99% Invisible, 2022). With the collapse of American household spending
and a reduction in orders from the Western hotel industry, demand dropped dramatically. According to Chen
and Qi (2021), between 2008 and 2010, Dafen's export volume dropped by about half, and some workshops
even closed. The 2008 financial crisis exposed three vulnerabilities that were not unique to Dafen, but rather
common among export-oriented Chinese manufacturing industries at the time: a heavy dependence on a limited
number of overseas markets, an inadequate positioning within the value chain, and a lack of distinctive brand
identity and distribution channels.
The response, both at Dafen and nationally, defined the direction of China's industrial policy throughout the
2010s. The key idea was industrial upgrading (产业升级, chanye shengji): moving away from low-cost,
low-margin assembly and copying, toward higher-value activities such as design, original creation, and
branding. In Dafen specifically, the Shenzhen government took several concrete steps. It expanded the role of
the Dafen Art Museum, launched residency programs for original artists, redesigned the Cultural Industries Fair
to focus on original works, and offered subsidies and reduced rents to painters who registered as creators of
original artworks (Chen and Qi, 2021; Cheung, 2024). The slogan that came to summarize the effort, both
locally and nationally, was "from Made in China to Created in China" (从中国制造到中国创造).
In the early 2020s, original works accounted for about 30% of the district's added value, compared to around
10% before the crisis (Chen and Qi, 2021). Today, fewer painters export their works. Dafen artists, however,
sell more domestically to China's growing middle class. Furthermore, there are simply fewer painters in Dafen.
At its peak, there were around 10,000 employed painters. Today, there are only between 3,000 and 5,000
(Cheung, 2024; He, 2019). There are two reasons for this decline. First, printing technology has replaced
painters who produced low-cost reproductions. Second, rising rents in Shenzhen have pushed the reproduction
industry out of the city, relocating it to cities in the Chinese hinterland or neighboring Vietnam, where labor is
cheaper. Dafen's transformation is therefore real but partial: the district has attracted higher-value added
activities, but at the cost of losing many of the workers who built it.
This story is, in many ways, representative of China's manufacturing industry as a whole. Sector by sector,
China has made great strides up the value-added ladder. In some sectors, the upgrading process has been
extraordinarily successful: electric vehicles (BYD, CATL), telecommunications equipment (Huawei),
high-speed rail and solar panels. Today, none of these sectors depend on American components to remain
globally competitive. Other sectors have seen much less progress, even after decades and trillions of dollars of
state investment, including advanced semiconductors and commercial aviation (USCC, 2024; Mischer, 2025).
This confirms Lin's (2014) prediction: industrial policy works when the gap between current and desired
capabilities is small, while it encounters difficulties when the gap is too wide.
4. Lessons from Dafen: four overlooked features of Chinese supply-chains
The case of Dafen highlights four important aspects of the Chinese supply-chain system that are frequently
overlooked in mainstream analyses and that carry significant relevance for the ongoing discussion around
decoupling and supply-chain diversification.
First, Chinese industrial districts depend on extremely dense networks of small suppliers and on informal
coordination that is hard to measure. Dafen's production system relies not only on painters, but also on a
network of canvas suppliers, framers, packaging companies, and freight forwarders, as well as on skills passed
informally from masters to apprentices. The same type of dense and difficult-to-replicate ecosystem exists in
Shenzhen's electronics district, where speed and flexibility depend on the presence of thousands of small
component suppliers within a 200-kilometer radius (Hossain, 2022).
Second, Hong Kong and other extraterritorial actors have played a crucial role in the creation of many Chinese
industrial clusters. Dafen would not exist without Huang Jiang and the Hong Kong art dealers who connected it
to Western buyers. Shenzhen's electronics cluster would not exist without Taiwanese contract manufacturers
like Foxconn, Pegatron, and Quanta, which moved their operations to mainland China in the 1990s and 2000s.
Yiwu, the world's largest small-goods wholesale market, would not exist without Wenzhou's trade networks and
the Chinese diaspora's connections in the Middle East, Africa, and Latin America (Brandt, Ma, and Rawski,
2014). Chinese manufacturing has always been transnational at its core, making attempts to fully decouple it
more difficult than they seem.
Third, the relationship between integration and industrial policy is sequential. In the initial phase, integration
into global markets comes first: private traders and foreign buyers create demand, migrant labor responds, and
clusters form. The state then intervenes to support and consolidate what already exists. Later, as the cluster
matures or experiences a crisis, the state takes a more active role, pushing it toward higher-value added
segments. This sequence—market formation, then state recognition, then state-led modernization—is what
Sebastian Heilmann (2008) calls "experimentation under hierarchy."
Fourth, the human cost of district development and upgrading is real and unevenly distributed. Dafen painters
earned more than they would have in their home villages, but they did so under intense pressure from
piecework, long hours, and full exposure to foreign demand cycles. Post-2008 upgrading resulted in the loss of
thousands of painters whose specific skill—copying—lost its market value. The same dynamic can be observed
in other sectors. China Labor Watch's 2025 report on Foxconn Zhengzhou, the world's largest iPhone factory,
documents wages of $1.70 to $3.52 per hour during peak production, with 12-hour shifts and weak labor
protections.
Conclusion
The village of Dafen, which began as a small Hakka settlement on the outskirts of Shenzhen, transformed itself,
over the course of nearly two decades, into the world's largest production center for hand-painted oil
reproductions. After the 2008 crisis, it gradually shifted its focus toward the production of original artworks.
This evolution is useful because it demonstrates, on a small scale, the same dynamics that explain China's rise
as a global supply-chain hub. The district grew thanks to integration into global markets, made possible by
Hong Kong intermediaries and Western demand. This worked because thousands of painters concentrated in a
few square kilometers generated the kind of agglomeration economies that economists typically associate with
industrial districts. Its consolidation occurred when the Shenzhen government recognized and supported it
starting in the mid-2000s.
The broader point is that China's position in global manufacturing is the result of two forces that have operated
together over time: integration into global markets on the one hand, and a flexible, multi-level industrial policy
on the other. Neither force alone would have been sufficient. This has direct implications for the current debate
on supply chain diversification. The possibility of relocating production to Vietnam, India, or Mexico depends
less on these countries' ability to build factories, which they can, and more on their ability to develop the
surrounding ecosystem of suppliers, logistics networks, local governance capacity, and informal coordination
that China has spent several decades building. Dafen is a small example, but it illustrates this point: the painter
who produces a copy of Starry Night for a hotel buyer, a worker assembling iPhones at Foxconn in Zhengzhou,
and a merchant shipping Christmas decorations from Yiwu to Lagos - they all operate within the same
structural conditions. Understanding these conditions, rather than focusing on a single sector or policy, is what
the Chinese case ultimately requires.
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