Price reform stalled: An inherent obstacle, a missed opportunity

Wiemer, Calla

doi:10.1016/1049-0078(90)90027-x

Cited by 1 publication

(4 citation statements)

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“…In China's case though, a reduction in monetized deficits is not necessarily an indication of greater fiscal and monetary responsibility because credit extension by state commercial banks is unlinked to changes in the monetary base and can readily substitute for on-budget expenditures. This indeed is what has occurred (Wiemer, 1990).…”

Section: China's Approach To Price Reform In the 1980ssupporting

confidence: 70%

“…More deliberate accommodation was characteristic of the earlier part of the reform period and took a variety of forms, most of which, however, eventually came to bear on the government budget (Wiemer, 1990). First, increases in the procurement prices of staple crops were only partially passed on to urban residents, with state commercial units absorbing the resulting trading losses.…”

Section: China's Approach To Price Reform In the 1980smentioning

confidence: 99%

“…Figure 1 indicates that rural industrial employment actually fell in 1982 and again in 1989. The 1982 contraction coincided with administrative restrictions intended to prevent rural enterprises from becoming a competitive threat to the state sector.&dquo; In 1989, intensifying conflict between state and nonstate was again at stake, only this time the nonstate sector was suppressed indirectly through the cessation of bank lending (Wiemer, 1990). During the period of most rapid growth in rural industry and services between 1982 and 1986, the pull on labor (1985: 224; 1986: 234; 1988: 220; 1990: 224); Guojia tongji ju (1990: 114).…”

Section: Labor Reallocationand Productivityin the 1980smentioning

confidence: 99%

“…The growth rates of loans to various types of borrowers showed a clearly oscillating pattern over time (Wiemer, 1990). Nonstate borrowers received a wild burst of credit immediately following the banking reforms of 1984.…”

Section: Labor Reallocationand Productivityin the 1980smentioning

confidence: 99%

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Price Reform and Structural Change

Wiemer

1992

Modern China

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China at the outset of reform diverged radically from what would likely have resulted under a market system. For three decades, labor migration out of agriculture had been barred, staple crops had been procured under mandatory quota, and ownership of farm land and machinery had resided with rural collectives. Concomitantly, all rural residents were assured employment and, in general, a subsistence income. In the cities, too, certified residents were assured a job and an income, much of the latter in the form of direct in-kind provision or rationed access to goods in short supply. Standards of living were much higher in the cities than in the countryside, but by and large even urbanites found such amenities as household appliances or living space in excess of a few square meters per capita to be unobtainable luxuries. Beyond the basics, the resources of society were channeled into investment in heavy industry rather than toward achieving higher standards of personal consumption.The transition from an economy in which, by plan dictate, production was concentrated in agricultural staples and heavy industry, while food, clothing, and shelter were adequately provided but any consumption extras were overpriced or simply unavailable, to one in which resources moved freely in search of their highest-valued returns, threatened to disrupt job stability and sunder the welfare safety AUTHOR'S NOTE: Financial support from the Committee for Scholarly Communication with the People's Republic of China, with funds from the U.S. Information Agency, is gratefully acknowledged. Three anonymous reviewers provided useful comments on an earlier draft of the article.

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Section: China's Approach To Price Reform In the 1980ssupporting

confidence: 70%

Section: China's Approach To Price Reform In the 1980smentioning

confidence: 99%

Section: Labor Reallocationand Productivityin the 1980smentioning

confidence: 99%

Section: Labor Reallocationand Productivityin the 1980smentioning

confidence: 99%

See 2 more Smart Citations