China and the International Economic System
AbstractSince the inception of economic reforms in 1979, China's economic performance has been nothing short of spectacular. Between 1979 and 1994, China's real growth rate has averaged more than 9 percent annually. Agriculture has been decollectivized, the management of state-controlled firms has been decentralized, and property rights reforms have facilitated an explosion of businesses outside central government control. Goods and factor markets have been liberalized to a significant extent: most prices are now determined by markets, state control of labor markets has been reduced, and previously repressed capital markets have experienced rapid, if uneven, development. China nevertheless retains a significant state-owned sector, and problems associated with lack of reform in this sector, combined with the relatively primitive nature of macroeconomic policy instruments, has lead to a stop-start pattern of growth and problems with inflation. The time path of Chinese economic growth is subject to considerable uncertainty.
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