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Stay or go? That question has erupted in a public way among China’s large population of expatriate businessmen, entrepreneurs, journalists, and academics, who the public security bureau says number 220,000.

The debate started with an essay, “You’ll Never Be Chinese: It Is Time to Leave the Country I Loved,” by former magazine publisher Mark Kitto, a British 16-year resident of China. After his English-language magazine was seized by the government, Kitto retreated to Moganshan mountain outside Shanghai, where he and his Chinese wife have run a restaurant and guesthouse business for the last seven years. “Don’t you think,” asked Kitto in the August edition of Britain’s Prospect, “with all the growth and infrastructure, the material wealth, let...