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Upholding the Planned Economy as Primary and Market Regulation as Supplementary


  • Gong Shiqi
  • Xu Yi


It is a consistent thinking of Comrade Chen Yun's that in China's socialist economy, the planned economy is primary and market regulation supplementary. In the early period after the founding of the People's Republic, he advanced the idea that planned production should play a major role and free production a minor role (>i>da jihua xiao ziyou>/i>). In 1956 when the socialist transformation of the ownership of means of production was basically completed in China, he reiterated that planned production should play a primary role in industrial and agricultural production while free production according to market changes and within the scope permitted by the state plan should supplement planned production; the state market should be the primary entity of a unified socialist market, but there should also be a subordinate free market under the leadership of the state and within a given scope to supplement the state market. This was how Comrade Chen Yun summed up the relationship between the planned economy and market regulation given the situation at the time. At the same time, it was a far-sighted conception that continues to have guiding meaning for us today. During the past year or more, Comrade Chen Yun has repeatedly emphasized, with purpose, the importance of the planned economy. In his talk with comrades of the State Planning Commission during the Spring Festival this year, he said: Our country implements a planned economy. Industry must take the planned economy as primary, and agriculture, even after the implementation of the responsibility system, must still take the planned economy as primary. Even more should planning be strengthened in our enterprises. In short, correctly understanding and handling the relationship between the planned economy and market regulation is a fundamental question in socialist economic theory, as well as the crux of economic structural reform.

Suggested Citation

  • Gong Shiqi & Xu Yi, 1993. "Upholding the Planned Economy as Primary and Market Regulation as Supplementary," Chinese Economy, Taylor & Francis Journals, vol. 26(3), pages 64-78, April.
  • Handle: RePEc:mes:chinec:v:26:y:1993:i:3:p:64-78

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