Agriculture in China's Modern Economic Development by Nicholas R. Lardy

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  • January 31, 2017
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By Nicholas R. Lardy

Explores the connection among the chinese language peasantry, who're the basic base of help for the innovative chinese language Communist social gathering, and the state-led economy tested by means of the occasion after 1949.

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Sample text

Naturally the relative disadvantage of the quantity mode of control is thus reduced. Despite this erosion of the advantage of price control in this case, as a general proposition price The theory of price and quantity control 27 controls will remain the preferred instrument of control for two reasons. First, most agricultural products are produced independently so the erosion does not arise. , C 12 = 1) so that the final marginal cost curve for good 1 was unchanged, the price mode would retain a comparative advantage over the quantity mode.

Thus products subject to "planned purchase," such as grain, or "unified purchase," such as cotton, generally could not be sold freely in rural markets, whereas the marketing of other products, particularly sideline and subsidiary items, was restricted less, particularly prior to the socialization of most private commerce in 1955. Consequently, the magnitude of grain transactions in rural periodic markets was curtailed substantially, from about 7 to 8 million tons annually in the early 1950s to 2 to 3 million tons by 1954-55 (Eckstein 1977, 117; Ishikawa 1967b, 42).

In the early to mid-1950s first individual farmers and subsequently mutual aid teams responded in an economically predictable fashion to the changing set of price incentives offered by the state. Farmers in this respect seem to have changed little from the pre-Communist period when they operated in a relatively competitive market economy (T. Rawski 1977). Traditional periodic rural markets were the major mechanism of private commerce in the early 1950s, as they had been in the lower Yangtse since the time of the transition between the T'ang and Sung dynasties (Shiba 1975) and over a much broader area during the Ming and Ch'ing dynasties (Skinner 1964-65).

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