Restructuring Incentives in the People’s Republic of China

Armin Gutowski and Renate Merklein

Chapter 12 in Economic Incentives, 1986, pp 329-347 from Palgrave Macmillan

Abstract: Abstract The People’s Republic of China is different from all other countries whose experiences are being discussed at this conference: it is, according to World Bank definitions, a “low-income country”, one of the least developed in the world. But within that group it is the country with the most assets that are conducive to achieving considerable success if incentives are set in the right way. The Chinese people are highly talented and able to react appropriately and fast to economic incentives; from their long and vicissitudinous history they have developed neither fatalist religions nor caste systems, which in other countries greatly impede the effectiveness of economic incentives. Not only quite a few periods of economic success in Chinese history but also today’s remarkable achievements of those roughly 50 million Chinese who now live outside the People’s Republic demonstrate that people of Chinese origin are able to overcome poverty and scarcity through inventiveness and flexible reactions, if a market-oriented system allows them to do so.

Keywords: Foreign Trade; Socialist Economy; Relative Prex; Price Ratio; Wage Structure (search for similar items in EconPapers)
Date: 1986
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Persistent link: https://EconPapers.repec.org/RePEc:pal:intecp:978-1-349-18204-6_12

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DOI: 10.1007/978-1-349-18204-6_12

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