If China’s Market Economy Causes Economic Growth For Them, Why Did They Have A Planned Economy Before?
Posted by China Sourcing CommentatorAug 6
China had a market economy since the Han dynasty. Why did they want a planned economy before they changed back to a market economy around 1979?
Popularity: 8% [?]
There have always been people who rise to power who want to tell others how to do things. They ‘know’, and force others to comply. History is full of such dictators and their demise but that doesn’t stop new ones appearing.
Nationalists overthrew the Manchu Dynasty, then Communists overthrew them.
Mao Zedong’s Red Army seized control, claimed a ‘Cultural Revolution’, and directed China’s production but central planning was not providing the goods people needed. Famines were common and products were scarce.
Recent Chinese leaders are slowly reforming policies to permit some market forces to prevail, which has released pent up industriousness and demand.
There are few if any pure market economies. Markets are mostly ‘mixed’, with various proportions of freedom (to buy and sell whatever you want), and restrictions (taxes, duties, regulations, quotas, prohibitions).
It must have seemed like a good idea at the time, but you know what they say about good intentions.
Hey, better to see the light late rather than never…