One often hears Western commentators on China asserting that China is organised on Confucian principles. I do not know much about China and so cannot comment on how fitting this description is. But I have questions on making inferences about a society using a text written in 500 BC.
To take an Indian analogy Manu Sashtra or the Laws of Manu were used by many authors (mainly till mid-1900s) to understand the caste system in India. In a paper written in the 1960s Andre Betèille criticised Louis Dumont for trying to understand social institutions from textual sources – and those written long time ago. Following his teacher M N Srinivas, Betèille pointed out that the “book view” of the society is often erroneous and is certainly incapable of understanding the dynamics of social institutions. He pointed out, for example, that the introduction of adult franchise in 1947 in India had significant effect on the caste system in India that could not be captured from the Laws of Manu. I feel that the same argument can be made of China as well.
I feel very uncomfortable to read assertions of what the Chinese society is like based on a text written several millennia ago. In fact, I would argue that it is unlikely that his works are represented the society even at that point of time. In saying this, I do not claim that textual sources are not useful in understanding social institutions. Texts are better understood as live and dynamic and written with a view of influencing how things work (see institutional ethnography resources for some interesting ideas on the use of texts). I also like Foucault’s method of uncover shifts in ideas using a large volume of texts at different points of time.
While early texts are useful sources of information on a society, I think we should not make casual assertions that a society is governed by principles outlined in any text written recently or thousands of years ago.