Efficiency, Mobilization And Economic Growth:Shanghai Industries In Planned Economy Time

The extensive economic growth and low benefit before the reform and opening-up have made such a huge impression that few can realize the government’s efforts to increase efficiency at the same time. So, this article investigates the organization and mobilization on production by the government in order to achieve the rapid growth of industrial economy since1949to the early years of1980’s, focuses on the specific practices and institution arrangements at micro-level by the administrative power from top to bottom and the responses and reactions by the managers and workers in factories, and takes industrial city Shanghai as a case study.The main text part is divided into6chapters. Chapter1summarizes the social environments and policy implementation during the course of taking over and reconstructing city’s industries by the government in the early1950’s, involving the difficulties on introducing the Soviet model and improving the efficiency of production by means of system building. Chapter2discusses respectively three basic measures (technology popularity, organization management and incentive) and its outcome on system building of planned economy by the government before the Great Leap Forward. In chapter3, the author wants to show how the high production quota is created and the disorder of planning management during the Great Leap Forward. Chapter4introduces the adjustment of economic growth target by the government and system rebuilding in early mid-1960s. Chapter5examines the situation of industrial organizations and its relation to the revolutionary mobilization and upstairs politics during the third and fourth Five-Year Plan. Chapter6studies the change in government and the cause of the economic system reform in the late1970’s, particularly the establishment of principle of giving priority to efficiency.In the conclusion, the author argues that the nascent regime born in1949is achieving industrialization with resources shortages. The rapid growth of industrial economy shows the efficiency of China’s planned economy and incentive of its own. The instruction system that consists of production quotas and reward and punishment system are the core engine of China’s economic growth. Labor emulation, the mobilization on production by the government like a mass movement, is the most favorite method for stimulating the laborers. However, the incentive mechanism brings rapid economic growth while results in an irretrievable injury to the profits. The change in government in the second half of the1970’s provides a new opportunity to economic system reform. The new state ideology revises the rules of property rights, and changes the incentive mechanism. The new profits distribution pattern accepts the material incentive that is disapproved of before, so as to give a new growth to China’s industrial economy. The proprietor has strong motive to improve economic benefit because of the possession of surplus profits. The state power exits part of economic domain and leaves the companies to bear the operating cost and investment risk.