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The Political Development Cycle: The Right and the Left in People's Republic of China from 1953

Author

Listed:
  • Anton Cheremukhin
  • Mikhail Golosov
  • Sergei Guriev
  • Aleh Tsyvinski

Abstract

We quantify the effects of the political development cycle—the fluctuations between the Left (Maoist) and the Right (pragmatist) development policies—on growth and structural transformation of China in 1953–1978. The left policies prioritized structural transformation toward nonagricultural production and consumption at the expense of agricultural development. The right policies prioritized agricultural consumption through slower structural transformation. The imperfect implementation of these policies led to large welfare costs of the political development cycle in a distorted economy undergoing a structural change.

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  • Anton Cheremukhin & Mikhail Golosov & Sergei Guriev & Aleh Tsyvinski, 2024. "The Political Development Cycle: The Right and the Left in People's Republic of China from 1953," American Economic Review, American Economic Association, vol. 114(4), pages 1107-1139, April.
    • Handle: RePEc:aea:aecrev:v:114:y:2024:i:4:p:1107-39
    DOI: 10.1257/aer.20220249
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    References listed on IDEAS

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    2. Huang, Wenbin & Mishra, Ashok K., 2025. "Understanding agricultural subsidies and factor allocation: A general equilibrium analysis," Economic Modelling, Elsevier, vol. 153(C).
    3. Kok, Chun Chee & Lim, Gedeon & Shariat, Danial & Siddique, Abu & Tsuda, Shunsuke, 2025. "Interethnic Proximity and Political Development," IZA Discussion Papers 17776, IZA Network @ LISER.
    4. Konysev, Vasilij & Fehrle, Daniel, 2025. "To converge or not to converge: Accounting for the German reunification," VfS Annual Conference 2025 (Cologne): Revival of Industrial Policy 325462, Verein für Socialpolitik / German Economic Association.
    5. Peng, Guohua & Zhao, Xiaoling, 2025. "Effects of export growth on the location choices of migrant workers: Evidence from China," China Economic Review, Elsevier, vol. 92(C).
    6. Batabyal, Amitrajeet & Beladi, Hamid, 2024. "Political Power Shifts, Varying Tax Policy, and Economic Outcomes in a Creative Region," MPRA Paper 122595, University Library of Munich, Germany, revised 29 Oct 2024.
    7. Daniel Fehrle & Vasilij Konysev, 2025. "A “Marginal” Tale of Two Germanies: Accounting for the Systemic Divide," Discussion Paper Series 347, Universitaet Augsburg, Institute for Economics.

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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • N15 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Asia including Middle East
    • N45 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Asia including Middle East
    • N55 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - Asia including Middle East
    • O21 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy
    • P21 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Planning, Coordination, and Reform
    • P24 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - National Income, Product, and Expenditure; Money; Inflation

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