Economic Development in the Context of China: Policy Issues and Analysis

232 Pages·1993·22.879 MB·English

by  Clement Tisdell (auth.)

ECONOMIC DEVELOPMENT IN THE CONTEXT
OF CHINA
Also by Clement Tisdell
THE 'GREEN REVOLUTION' AND ECONOMIC
DEVELOPMENT (with Mohammad Alauddin)
Economic Development
in the Context of China
Policy Issues and Analysis
Clement Tisdell
Professor of Economics
The University of Queensland
Brisbane
M
St. Martin's Press
© Clement Tisdell 1993
Softcover reprint of the hardcover 1st edition 1993 978-0-333-54225-5
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First published in Great Britain 1993 by
THE MACMILLAN PRESS LTD
Houndmills, Basingstoke. Hampshire RG21 2XS
and London
Companies and representatives
throughout the world
A catalogue record for this book is available
from the British Library.
ISBN 978-1-349-39001-4 ISBN 978-0-230-38018-9 (eBook)
DOl 10.1057/9780230380189
First published in the United States of America 1993 by
Scholarly and Reference Division,
ST. MARTIN'S PRESS, INC.,
175 Fifth Avenue,
New York. N.Y. 10010
ISBN 978-0-312-08670-l
Library of Congress Cataloging-in-Publication Data
Tisdell, C. A. (Clement Allan)
Economic development in the context of China: policy issues and
analysis I by Clement Tisdell.
p. em.
Includes index.
ISBN 978-0-312-08670-1
I. China-Economic policy-1976- 2. China-Economic
conditions-1976-- I. Title.
HC427.92.T57 1993
338. 951-dc20 92-24485
CIP
Contents
List of Tables X
List of Figures xi
Preface Xlll
1 China and its Economic Development in International
Perspective 1
1.1 Introduction
1.2 Why Is it Useful to Discuss Economic Development
Issues in the Context of China? 3
1.3 Economic and Related Features of China and
Comparisons Mainly with India 4
1.4 China's Transformation 9
2 Major Policy Issues, Reforms, Protest and Economic
Achievement 11
2.1 Protest and Economic Change 11
2.2 Economic Achievements 12
2.3 Structural Change and Associated Long-Term
Policies 14
2.4 Private Enterprises, Market and Institutional
Reforms 17
2.5 Economic Factors as a Source of Political Tension 20
2.6 Concluding Comment - Economic Development
and Political Change 24
3 New Technology and Development: Policy Issues and
Effects 29
3.1 Introduction -Past and Present Focus on Science
and Technology in China 29
3.2 New Technology as a Source of Economic Growth 31
3.3 New Technology and the Reduction of Economic
Scarcity 34
3.4 New Technology, Growth, Resources and the
Environment 37
v
vi Contents
3.5 Import of Technology and Economic
Interdependence with the Outside World 41
3.6 Distribution Consequences of New Technology 42
3.7 Conclusion 43
4 International Technology Transfer, Direct Investment and
Joint Ventures 46
4.1 Introduction - Benefits and Means of International
Technology Transfer 46
4.2 China's Interests in Direct Investment and
International Technology Transfer 52
4.3 Benefits of International Joint Ventures 53
4.4 Benefits to the Host of Joint Ventures in the Host
Country 54
4.5 Benefits to Foreign Partners of Joint Ventures in
the Host Country 55
4.6 Joint Ventures Abroad 57
4.7 Possible Difficulties or Costs of Joint Business
Ventures 58
4.8 Alternatives to Joint Ventures as Means of
Technology Transfer and Industry Development 60
4.9 Profit Sharing and Joint Ventures 62
4.10 Some Practical Matters to Consider 65
4.11 Concluding Comments on Joint Ventures and
International Technology Transfer 66
4.12 Some Additional Points about Direct Foreign
Investment in China and International Technology
Transfer 67
5 Regional and Urban Development: Government
Intervention 70
5.1 Introduction- China's Basic Regional
Development Strategy 70
5.2 Neo-classical Economic Theory, Regional and
Urban Development 72
5.3 Centre-Periphery Theories of Regional
Development 75
5.4 Market Failure in Regional and Urban
Development 77
5.5 Concluding Comments 82
Contents vii
6 Poverty, Income Inequality and Development 84
6.1 Introduction - Poverty and China's Income Policies 84
6.2 Measuring Poverty and its Incidence in Less-
Developed Countries 86
6.3 Economic Growth, Income Inequality and Poverty 87
6.4 'Trickle Down' of Economic Growth, Incentives,
Inequality and Economic Growth 91
6.5 Justice and Equity in Income Distribution and
Equality of Opportunity 93
6.6 Income Security and Efficient Allocation of
Resources 97
6.7 Concluding Comment 98
7 Agriculture and Agricultural Research Priorities 101
7.1 Agriculture and Economic Development 101
7.2 Technological/Scientific Change and Productivity
Increase in Agriculture 104
7.3 Priorities in Agricultural Research 106
7.4 Cost-Benefit Approach to Evaluating Agricultural
R&D 108
7.5 Limitations of Using Cost-Benefit Analysis to
Allocate Agricultural Research Funds 112
7.6 Conclusion 113
8 Interindustry Development - Manufacturing, Services and
Agriculture 117
8.1 Introduction - Interconnections between Industries
in Development 117
8.2 Economic Incentives and the Labour Surplus
Problem in Agriculture 119
8.3 Rural Industries 125
8.4 Manufacturing and Industrialisation in Balanced
Development 127
8.5 Service Industries 131
8.6 Conclusion 132
viii Contents
9 Prices, Markets and Resource Allocation in China 135
9.1 Introduction - Functions of Price and Market
Systems 135
9.2 Market Reforms in China 137
9.3 Double-Track or Two-Tiered Price Systems and
Economic Efficiency 140
9.4 Comparisons between the Economic Efficiency of
the Market Socialism Systems of Lange, Taylor and
Others, and China's Two-Tiered Price System 143
9.5 Factor Market Constraints and Limitations in
China and Economic Efficiency 146
9.6 Price Inflation and China's Economic Reforms 148
9.7 Conclusion 150
10 Management of Enterprises, Separation from Ownership,
and More on Markets 152
10.1 Introduction 152
10.2 Incentives and the Management of China's State-
Owned Industrial Enterprises 153
10.3 Separation of Ownership and Management - Does
it Increase Economic Efficiency? 157
10.4 Possible Implications for China's Institutional
Reforms 160
10.5 Markets - What Guidance Do they Need? 163
10.6 Concluding Comments 168
11 Foreign Tourism: Benefits to China and Contribution to
Development 171
11.1 Growth of Foreign Tourism in China 171
11.2 Some Problems Encountered in the Development of
China's Tourism Industry 173
11.3 Possible Objectives for China in Encouraging
Foreign Tourism 175
11.4 Some Aspects of the Taxing and Pricing of the
Supply of Tourist Services 182
11.5 Conflicting Objectives in Foreign Tourism Policies
-the Conflict Between National Gain and the
Maximisation of Foreign Exchange Earnings 185
11.6 Concluding Comment 187
Contents ix
12 Population Policy, Environmental Protection and
International Issues Raised by China's Development 191
12.1 Introduction 191
12.2 China's Population and Population Policy 192
12.3 Some Environmental Consequences of Population
Increase I 97
12.4 Pollution Control 198
12.5 International Environmental Issues Raised by
China's Economic Development 201
12.6 Concluding Observations 202
Index 207