How the Chinese Economy Works by Rongxing Guo

By Rongxing Guo

This fourth revised version sets out to investigate and evaluate the operational mechanisms of the chinese language economic system among the pre- and post-reform sessions and during nationwide, neighborhood and native dimensions. It examines the using forces – either endogenous and exogenous – that experience prompted China’s monetary improvement prior to now a long time. either confident and detrimental results of the chinese language monetary transformation were clarified. A multiregional comparability of the chinese language economic system is carried out when it comes to common and human assets, institutional evolution, in addition to monetary and social performances. This enlarged version comprises 3 new chapters on cultural range; usual and environmental assets; and, political and administrative structures. a number of the unique chapters have additionally been considerably revised, extended and up to date in keeping with newer research.

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1 Qin, Han and Jin Dynasties In 221 BC, China was unified by Ying Zheng (also called Qin Shihuang), the first emperor of the Qin dynasty. The most important contribution of the Qin dynasty was the foundation of a completely new social and political order under a strict system of rewards and punishment favored by a group of scholars known as Legalists. In place of feudalism, the country was reorganized into 36 prefectures and a number of counties. Under this prefecture-county administration, all authority was vested in the central government.

The six great regional administrations were destroyed during the Cultural Revolution period (1966–76). In 1970 the Chinese economy was spatially organized via ten economic cooperative zones (namely Southwest, Northwest, Center, South, East, Northeast, North, Shandong, Fujian and Jiangxi, and Xinjiang). It is generally believed that this arrangement was based on the centrally planned system and reflected the state’s efforts to meet the desperate need for regional self-sufficiency at the high point of the Cold War era.

For example, as reported by Liu (1996, pp. 153–6), the optimum number of provinces has been suggested as 58 by Hong (1945a, b), 40–43 by Hu (1991) and 43 by Guo (1993). 1 Historical Evolution When the PRC was founded on 1 October 1949, China’s provincial economies were managed through six great administrative regions (North, Northeast, East, Central South, Southwest, and Northwest). With the exception of the North region, which was under the administration of 28 R. Guo the central government, the other five great regions also had their own governmental bodies in charge of agriculture and forestry, industry, public finance, trade and so on.

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