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China's Industrial Performance Since 1978

Published online by Cambridge University Press:  12 February 2009

Extract

In the late 1970s, Chinese industry was on the verge of collapse. Its high but erratic rate of growth since 1949 had been achieved by using ever-increasing amounts of labour and capital. Not only was industry operating inefficiently, but the output mix was inappropriate and inventories had accumulated to very high levels. However, the true state of affairs had been obscured by the political turmoil of the Cultural Revolution (1966–76) and the virtual disbanding of the State Statistical Bureau (SSB).

Type
The Chinese Economy in the 1990s
Copyright
Copyright © The China Quarterly 1992

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References

1. “Communiqué of the Third Plenum of the 11th Central Committee of the Communist Party of China,” adopted 22 12 1978Google Scholar, Foreign Broadcast Information Service Daily Report-China (FBIS), 26 12 1978, pp. E4E13.Google Scholar

2. For a discussion of some of the experiments and the results achieved during 1978–82, see Field, Robert Michael, “Changes in Chinese industry since 1978,” The China Quarterly, No. 100 (12 1984), pp. 745756.Google Scholar

3. “Communiqué of the Third Plenum of the 12th Central Committee of the Communist Party of China,” FBIS, 22 10 1988, pp. K1K9.Google Scholar

4. The State Statistical Bureau (SSB) had added a total specifically identified as including village and below in its annual reports for internal use as early as 1981. Totals in other sources and detailed data in the annual reports, however, did not include village and below.

5. The joint state-private and private enterprises that existed in the 1950s had all been abolished by 1958. See SSB, Ten Great Years (Beijing: Foreign Languages Press, 1960), p. 38.Google Scholar

6. The year in parentheses shown in Table 1 after the various forms of ownership indicates when the form was first recognized as a separate category. Wherever possible, data for these new categories have been included for the earlier years.

7. The complete list of branches and sub-branches introduced in 1985 is given in SSB, Zhongguo dazhongxing gongye chiye (China's Large and Medium Scale Enterprises) (Beijing: China Urban Economics Society Press, 1989), pp. 264282.Google Scholar For the 15 branches (as revised in 1972) and a concordance, see SSB, Industrial and Transportation Statistics Department, Zhongguo gongye jingji tongji nianjian, 1988 (China Industrial Economics Statistical Yearbook, 1988) (Beijing: China Statistics Press, 1989), pp. 373–79 and 280398.Google Scholar

8. SSB, Industrial Economics Statistical Yearbook, 1991, pp. 133141.Google Scholar The yearbook contains data from 1990 for a variety of industrial statistics.

9. Figures from 1988 are given in SSB, Industrial Economics Statistical Yearbook, 1989, pp. 5859Google Scholar; those for 1989 and 1990 are only given as a per cent of total in SSB, Industrial Economics Statistical Yearbook, 1991, pp. 7273.Google Scholar

10. With a few exceptions, they are derived by simple addition or subtraction. The exceptions are estimates in 1980 constant prices for village industry, city co-operative, county town co-operative, city individual and county town individual in 1987–89, and for total, collective and individual in 1990. The estimates were derived from the corresponding figure for the previous year and a reported index or percentage increase.

11. Beijing: China Statistics Press, 1982 to 1991.

12. Beijing: China Statistics Press, 1985 to 1991.

13. I wish to thank the Industrial Statistics Department, the State Planning Commission, the State Information Agency and the Chinese Academy of Social Sciences. They all helped to correct my errors and to fill gaps in the data. The remaining errors are my responsibility.

14. In 1987 I was working on the value of agricultural output and discovered that the current and constant price data for village and below-village industry in 1985 were identical for every province in China and that most provinces had never distinguished between current and constant prices. See Field, Robert Michael, “Trends in the value of agricultural output, 1978–86,” The China Quarterly, No. 116 (12 1988), pp. 556591Google Scholar, especially Table 3. When asked, the Industrial Statistics Department said that it could not accept the constant price data submitted to it by the provincial statistical bureaus for village and below in 1985 but had not yet had time to prepare its own figures.

15. SSB, Zhongguo tongji nianjian, 1990 (China Statistical Yearbook, 1990) (Beijing: China Statistics Press, 1991), p. 395.Google Scholar

16. SSB, Statistical Yearbook, 1991, p. 391.Google Scholar

17. SSB, Statistical Yearbook, 1985, p. 315Google Scholar; 1986, pp. 273 and 276; or 1987, p. 257.

18. The Industrial Statistics Department is well aware of the problems with GVIO. It is currently experimenting with collection of value added data directly from all enterprises in five cities. When the results of the experiment have been evaluated, it intends to implement the system nation-wide.

19. The Chinese refer to the upward bias in constant price data as shuifen.

20. It would be very easy for the Statistical Bureau – or anyone else who had access to data cross-classified by branch of industry and form of ownership-to test this hypothesis.

21. The 1985 industrial census collected but never tabulated information that would have thrown light on the extent of the upward bias, at least for he first half of the 1980s. Enterprises were required to fill out a form that listed each new commodity, the year it was first introduced, how much was produced in 1985 and the total value of its output in current prices. Tabulating the data by year first produced would have provided the information necessary to estimate 1985 price indexes for commodities first produced in 1981, 1982, etc.

22. SSB, Industrial Economics Statistical Yearbook, 1988, p. 44.Google Scholar

23. Junpu, Hou, “About the significance of establishing development funds for exploring new products for export,” Quanguo xinchanpin (National New Products), No. 3 (1990), pp. 1214.Google Scholar

24. The difference (which is in percentage points) is not a good measure because the sum of separate estimates for two consecutive years is not the same as the estimate for the two years taken together. The figures for 1985–87 and 1987 alone in Table 5 imply that there was a downward bias in 1986, whereas my estimate for 1986 was an increase of 0.4 percentage points. If they had used the ratio of official to estimated output indexes as their measure of bias, the product of separate figures for any series of years would have equalled the figure for the period as a whole and the measure could be used to deflate both indexes and output values.

25. This is my grouping of the official categories of ownership.

26. Capital is the sum of the net value of fixed assets at year end (at original purchase price) and the average value of working capital (in current prices). For a discussion of the upward bias in the data for the value of fixed assets and an estimate for state-operated independent-accounting industrial enterprises, see Chen, K., Jefferson, G., Rawski, T., Wang, H. C. and Zheng, Y. K., “New estimates of fixed investment and capital stock for Chinese state industry,” The China Quarterly, No. 114 (06 1988), pp. 243266.Google Scholar

27. “Communiqué of the State Statistical Bureau of the People's Republic of China on fulfilment of China's National Economic Plan,” 1978, 1979, 1980, 1981 and 1982.

28. Zhongguo jingji ribao (China Economic Daily), No. 4 (1983), p. 27.Google Scholar

29. BBC, Summary of World Broadcasts, FE/W1316/A1, 5 12 1984.Google Scholar

30. FBIS, 30 03 1983, p. K10Google Scholar. Smaller enterprises paid according to an progressive eight-level scale.

31. Renmin ribao (People's Daily), 14 04 1991.Google Scholar

32. The rate is derived from the projected total for 2000 in 2000 nian de Zhongguo (China in the Year 2000) (Beijing: China Social Science Press, 1989), p. 578Google Scholar and the actual figures for 1980 and 1990 in Table A3.

33. The DRC undertook a massive study, China in the Year 2000, in the mid-1980s. Its findings were published in 15 volumes between 1987 and 1989, and summarized in English in Huijiong, Wang and Boxi, Li, China Towards the Year 2000 (Beijing: New World Press, 1989).Google Scholar