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Economic Reform in China

Problems and Prospects

In this volume, distinguished Chinese and Western scholars provide a detailed examination of the problems associated with China’s transition to a market-oriented system. A variety of reform proposals, aimed at resolving the contradictions inherent in piecemeal reform, are discussed along with the chances for future liberalization.

These clearly written and insightful essays address the roots of China’s crisis. The authors focus on institutional changes necessary for a spontaneous market order and point to the close relation between economic reform and political-constitutional reform. Topics include the speed and degree of the transition, whether ownership reform must precede price reform, how inflation can be avoided, steps to depoliticize economic life, how to create an environment conducive to foreign trade and investment, and how to institute basic constitutional change and open China to the outside world.

The revolutionary changes now shaking the foundations of socialism and central planning in the Soviet Union and Eastern and Central Europe are sure to have an impact on China’s future. Despite their seriousness, the events of Tiananmen Square may constitute only a temporary detour on the road toward a private market order. The essays in this volume help lay a rational framework for understanding China’s present problems and for discussing the prospects for future reform.

400 pages | 15 line drawings | 6.00 x 9.00 | © 1989

Asian Studies: East Asia

Economics and Business: Economics--International and Comparative

Table of Contents

Crisis and Opportunity in China
Edward H. Crane

Editors’ Preface
Part 1 - China in Transition: Setting a Framework for Reform
1. Using the Market for Social Development
Milton Friedman

Comment: Planning and the Market
Pu Shan
2. Privatization vs. Special Interests: The Experience of China’s Economic Reforms
Steven N. S. Cheung
Comment: Establishing a New Order of the Socialist Commodity Economy
Xu Pengfei
3. Pricing and Property: The Chinese Puzzle
James A. Dorn
4. Economic Chaos or Spontaneous Order? Implications for Political Economy of the New View of Science
Don Lavoie
Comment: The Impact and Influence of the New View of Science on China’s Reform
He Weiling
Part II - Decentralization and Development in China
5. The Importance of Reorganizing Money, Credit, and Banking When Decentralizing Economic Decisionmaking
Peter Bernholz
Comment: Financial Reform: A Prerequisite for Development
Liu Funian
Comment: On the Importance of Decentralizing Money
George A. Selgin
6. Recent Developments in China’s Financial Sector: Financial Instruments and Markets
Christine I. Wallich
7. Institutional Reforms in Chinese Agriculture: Retrospect and Prospect
Justin Yifu Lin
8. Property in Chinese Development: Some Historical Comparisons
John P. Powelson
Comment: Property Rights and Development: The Moral Dimension
Jo Ann Kwong
Comment: Reforming China’s Property System
Chen Weishu
9. Private Provision of Government Services
Gabriel Roth

Comment: The "Socialization" of Public Services
Zhou Mingwei
10. Economic Growth and Reform in China’s Provinces, Municipalities, and Regions
Thomas R. Dye
Comment: The Problem of Decentralization in China
Wang Xi
Part III - Economic Reform and Foreign Relations
11. The Impact of China’s Reform and Development on the Outside World
Xu Zhiming
12. The China-Hong Kong Connection
Yun-Wing Sung
Comment: The Role of Hong Kong in China’s Reform
He Gaosheng
Comment: The Integration of Hong Kong and China
John G. Greenwood
13. East Asian Economic Success: Implications for Chinese and U.S. Foreign Policy
Edward A. Olsen
Comment: China’s Market, U.S. Competitiveness, and Socialism
Chen Qida
14. The United States, China, and the Soviet Union: Managing a Complex Triangular Relationship
David M. Lampton
Comment: Challenges Facing Sino-American-Soviet Relations
Lu Yimin
15. China and America in a Changing World Order
Ted Galen Carpenter
Part IV - The Road to China’s Future
16. The Roots of China’s Crisis
Nien Cheng
17. A Free-Market Constitution for Hong Kong: A Blueprint for China
Alvin Rabushka
Comment: Freedom and Reform in Asian-Pacific Economies
Richard Y. C. Wong
Comment: China and the Growth-Oriented Policies of the Pacific Basin
George Shen
18. Economic Deregulation in the United States: Lessons for America, Lessons for China
William A. Niskanen
19. Let a Billion Flowers Bloom
George Gilder

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