Most history books endorse some version of this theory. It's not some libertarian revision, and it has absolutely nothing to do with communism (which didn't exist in any recognizable form anywhere in the world until the 19th Century and not in China until the 20th)
There are two main downsides to centralization.
1) A single ruler means the whims of that ruler can have major impacts on the development of society. When the Ming abandoned their treasure fleets, there was no alternative power to step in and continue expanding maritime commerce. The emperor was so powerful that their monopoly on trade decided the course of history for the whole region: https://en.wikipedia.org/wiki/Ming_treasure_voyages
2) A unipolar power structure inherently seeks to maintain the status quo. When you have a dynasty that already has unquestioned authority within its borders while also having no plausible rivals outside them (at the time of the "great divergence" the Mongols had ceased to be a threat), ANY change leads to a loss of status and power for the ruling elite. Any commercial activity or technological advance was measured by whether it benefitted the emperor or hindered him.
None of this is to say that there weren't substantial downsides to the decentralized mess of European politics. In earlier time periods, the centralized model helped China to be the richest region on earth while Europe was one of the poorest, but post-Renaissance, competition between European states drove innovation and pressured those states to expand or die. Both of which led to Portuguese ships sailing into Guangzhou in 1513 rather than Ming ships sailing into Lisbon.
Just remember that the situation which caused the Opium Wars was that since the 1300s or so, China had exported more than it imported, so the world's silver tended to settle in China. You can see the Spanish empire as a scheme to move silver from Mexico and Peru to China the long way via the Dutch.
The Honourable East India company settled on opium as the one commodity which might settle their balance of payments problem. The period when China was poor was 100, 150 years in the 19th and 20th centuries, linked to specific bad governments (Great Leap Forward, cough).
There are two main downsides to centralization.
1) A single ruler means the whims of that ruler can have major impacts on the development of society. When the Ming abandoned their treasure fleets, there was no alternative power to step in and continue expanding maritime commerce. The emperor was so powerful that their monopoly on trade decided the course of history for the whole region: https://en.wikipedia.org/wiki/Ming_treasure_voyages
2) A unipolar power structure inherently seeks to maintain the status quo. When you have a dynasty that already has unquestioned authority within its borders while also having no plausible rivals outside them (at the time of the "great divergence" the Mongols had ceased to be a threat), ANY change leads to a loss of status and power for the ruling elite. Any commercial activity or technological advance was measured by whether it benefitted the emperor or hindered him.
None of this is to say that there weren't substantial downsides to the decentralized mess of European politics. In earlier time periods, the centralized model helped China to be the richest region on earth while Europe was one of the poorest, but post-Renaissance, competition between European states drove innovation and pressured those states to expand or die. Both of which led to Portuguese ships sailing into Guangzhou in 1513 rather than Ming ships sailing into Lisbon.