What do the Deng Xiaoping

 Deng Xiaoping on what to do?
Mm at the University of Chicago, . zhouqiren.com
I had prepared for the meeting is another paper. However, on June 3 Kos (R. Coase) assistant professor of letters conveyed the following comments: papers, the seminar will not be perfect. to explain why he was willing to brave the risk of himself, but also try to complete the 97-year-old has been Coase mm founder and host of this workshop were asked to complete the tasks specified in mm.
first saw Kos name, is in a small book. It was the summer of 1985, Beijing Stone Corporation, a friend whispered to me two small books. open a view, is Zhang Wuchang with No word, which printed : ) illustrates the concept of system and institutional change theory. then I do not have much experience of market transactions, so the Theorem account for a little background. I consider 1978 to Beijing from the countryside in Heilongjiang university. Previously, I had no opportunity to high school, but a junior high school graduates in 1966, experienced a three-year suspension on the mountain in 1968 after the Cultural Revolution Township. so I got into the college notice it was already Russia's border in the neighboring land of mountains and the countryside for ten years. For people like me, the first page of the Deng Xiaoping era, that he was doing in August 1977 out of the reopening of the decision. This page has changed the fate of our generation.
1978 �� after October in Beijing, is China's great changes in the vortex center. We work hard to regain opportunity to learn reading. But then The city of Beijing, seems to have placed no less than a completely calm desk. we went to Xidan seen posters, circulated through all the available information at that time in Japan, the United States, Europe, Hong Kong, Korea, Singapore, reports on the situation of modernization, but also gathered in the Listening with the Third Plenary Session of the press release, and Deng Xiaoping's famous Italian journalist Fallaci conversation. standing on the port that the opening of China era, in order to digest a lot of blowing of fresh information, we study the self-organized group spent countless sleepless nights.
However, the most move us, or at a party and heard the news of the household responsibility system in rural areas of Anhui. It is people who went to the site investigation report back to the first-hand: increased threat of famine drought weather, forcing farmers to collective land quietly assigned accounts; result, grain yield significantly, but the if born in poverty, no change in rural China, there are rapid improvements in the original path of life! Our confusion is: why are proven to promote production and solve the peasants food and clothing production, but not superstructure, personal experience, of which there are a few I was of peasant origin, all like-minded, willing to re-enter the lives of rural areas and farmers, observation, inquiry, investigation, analysis, research and debate, raised the level of knowledge of the real world. By chance, these As a non-party who also participated in the 80's several CPC Central Committee on rural reform policy document preparation, drafting, revising, written mm outlaw the whole process, the party document, once issued, can not let me non-Party people to read! as if inadvertently, we have witnessed history: For the 800 million Chinese farmers, the household responsibility system reform in China Deng Xiaoping is the great drama of the first act.
one with Chinese characteristics
household responsibility system, definition of property rights is not a ; bring labor, does not contribute to the negative tendency to put the collective land by farmers, thereby binding members of the collective efforts of labor. Then I met that year ruled that parts of the county party secretary Li Yun River, he was in favor of the household responsibility system, were dismissed, return home to farming for 21 years! 1959-1961, the household responsibility system appear in the responsibility can be effective against famine field called A land system, the rural household responsibility system reform, why should the great drama of Deng Xiaoping as the first Mu?
find the answer from the household responsibility system itself. system The corresponding annual average yield of land area as the baseline, the number of farmers committed to pay to the state, how much to the collective, in exchange for the right to land contractual management. very clear, this is an stimulation of production of positive self-evident. On the other hand, the land contract home and did not change the br> farmers and grassroots production team invented the household contract responsibility system, this approach also proved effective to increase yield, resist famine. However, farmers and primary production teams can not decide on the household responsibility system can not be legally recognized. This Soviet-style centralized system is an outgrowth of: any economic organization, production changes, were seen as related to the socialist road and the direction of the event, which must be decided by the highest authority. In China, from the leg of the cooperatives Chairman of collective management of land contracted to farmers have a deep prejudice approach. a record that, although the severe famine has forced President acquiesced peasants, but as long as improved, he will definitely hold high the old line of class struggle and the struggle to be relentless fight against the flag. Throughout the Mao era, from the household responsibility system repeated back repeatedly.
contract spontaneously lack of legal recognition and protection of the parties expected to have adverse effects and behaviors. We see, of course, spontaneous household responsibility system so that farmers can increase production and taste the sweetness of food and clothing, but whether such benefits can not be sustained? continue the contract conditions for the future What changed? and contracting model under what circumstances they may be criticized? mm All of these concerns are affecting the farmers in production and investment (agricultural land protection and improvement) decision-making. This is from the nature of the contract itself, a substantial difficulty: to be honored as a group commitment, the expected instability inevitably increase the cost of contract performance.
Deng's contribution is to the direction of national policy, turned to the spontaneous production of contracts for legal recognition and protection. This is not the great statesman whim bit masterpiece. It recalls Du Runsheng, early in 1962, Deng Xiaoping spoke of easier and faster to restore agricultural production to take what form; people willing to take what form it should take what form it illegal to make it illegal that, Deng Xiaoping understood early on that household contract responsibility system created by the grassroots.
route of Deng Xiaoping, the peasant family contract system gained rapid development. household contract system in remote areas by the expansion of backward rural areas to developed areas, thus covering almost all the country's rural production teams; land contract period from one year to three years, fifteen years, three years extended to high standard of legal recognition: there is a secret from the grassroots, to the recognition of local government, to the affirmation of the CPC Central Committee policy documents. Finally, in 2002, China's National People's Congress passed the legal status. in accordance with the law, all agricultural land use right, usufruct and transfer rights, have long-term contract to the farmer; is due to all the agricultural land awarded to the farmers. As households have contracted the priority to renew the contract, In 1959, a proposition put forward: two or more parties each have a clear resource rights, how could between them to reach any one contract? However, China's practice is to remind people: it is precisely defined in the contract before the contract farmers clear land rights because the contract before the contract with , members of the household as a collective what kind of collective land ownership rights, are usually ambiguous. This is not to say that the farmers property rights but is defined by the contract before they get? In this sense, I think we can draw a new conclusion: the contract concluded with the definition of property rights is simply the same thing can not be separated.
contracts via another contract (re-contracted) have been adjusted, and property rights as defined by the contract will continue to continue to further clarify its economic implications and gradually improve property rights, the agreed terms of public resources in the exclusive right under the exclusive, not private property, then what is? in accordance with the contractual agreement in excess of the agreed yield some of the general contractor for all owned by it not to create a more complete private property is it? private property and beyond with the contract been contracted by the private property of the formation of a small increase, from weak to strong, the public members of the expanding scope of the contract concluded outside, gradually accumulate more private property, but also into a more diverse network of market contract. The contract defined by a clear property rights approach, from agricultural to non agricultural extension, and then extended to the city, laid the basis for China's market economy.
come to Chicago to attend the meeting when the spring wheat harvest is China. now in the fields of rural North China , there is a spectacular scene: hundreds of thousands of tractors and harvesters, along the line of mature crops across villages, across cities and counties, provinces and movement. These tractors and harvesting equipment, a private, a number of privately owned and set to a cooperative or a joint-stock companies, but also the , and only then they greater the number of farmers, cooperatives, corporate farms, demand for services connected to harvest together. even the government also participated in, a road emergency orders issued, requires not only along the highway on these agricultural Fenwenbuqu, and requires provide a good service. This is the experienced 30 years of reform, a microcosm of the Chinese economy: property rights and contract all the active form the institutional basis of production activities.
I have not seen Deng Xiaoping, theoretical expression. However, Deng's reforms of the road and lack of progress is to uphold the inalienable rights defined. The definition of property rights with Chinese characteristics, has been subject to criticism from different directions. A criticism that Deng's reforms go beyond the Second, the public, national economic performance significantly different to get a deep impression. another kind of criticism that the reform of property rights based on contractual agreement far less price: as long as the outdated ideas and vested interests a lot of people entangled in, any conditions. For example, all of us to Chicago, the meeting is to be with the Chicago municipal The answer is cost. each person is clearly a dedicated road too expensive, so the community next best thing, while retaining the insist that the case must allow the Chinese people under the constraints in the actual systems and organizational choice in the exploration and testing. any property rights, organization or contract, as long as has been shown to promote the increase of production and improving people's lives, Deng Xiaoping willing to use his political prestige to mobilize the state apparatus, in the progress, I find the practice in China's reform experience, contains a high universal truth, which is the generalized system of transaction costs determines the existence and change.
Second, the entrepreneurs, please return to China
2006 year, I visited the eastern Zhejiang Province town of Taizhou, pine doors, a private company. founder called Jiang Guilan, was a peasant girl, working for 10 years after graduating from high school in 1991, by private lending to 20 million, run from of this plastic products factory. Four years later, Jiang Guilan sublet to others in the Canton Fair to one sixth of the booth, and signed the first foreign export contracts. Then, after a decade, the river has become a KFC major global supplier of used utensils. so when I visited the river more than 1,000 workers the company has annual exports of 600 containers manufactured goods.
Jiang's story in today's China is very common. than Huawei The Ren, Alibaba's Jack Ma, Li Shufu, Geely, Mengniu and other big names like Niu Gensheng of private company CEOs, Jiang Guilan too common. However, if the reform, Jiang's company is a hundred times smaller than it is now also easy to from being seen as Of course, one would like to mention the pressure from the actual economic life. the one hand, the not growing employment requirements, especially the household responsibility system reform can not be released to absorb the large amount public ownership in a single system of the economy around, there like a stubborn weed growth, . they are self-employed or the use of family labor, little capital raised by the private market to capture these opportunities. some of the success of the self-employed, while the growing market requirements to further expand their business scale. the result,
of traditional thinking, the private ownership of production, freedom of employment, employment of workers in particular, more than 7 or more employees, of course, is Under this plan the boundaries of iron, China since 1956, completed the shrouded in China.
while holding both sides of the socialist reform, opening up the banner with Deng Xiaoping, seized a .80 seeds difficult to break early, Wuhu, Anhui old self-employed wide speculation on the , .1981 rapid expansion of business in September, three years, father and son hired four helpers from the beginning, two years into an annual turnover of 7.2 million yuan, 140 workers in the private sector. , the dispute all the way from Wuhu to Beijing. how decided upon small seeds inside a major?
I was working for rural policy research institutes Du Runsheng leadership, he organized on the and to report the material of Deng Xiaoping's desk. remember that the square footage back to the instructions categorically that to include treated like a dictatorship means that in a long wide private entrepreneurs.
Deng Xiaoping's approach is to allow the practice, and from reality to observe and analyze. cold-see wide employment of 140 workers for a long time, the original state-owned companies are not jobs; in Canton for a long time to pay the salaries of workers, not the state-owned factories pay below the local level; these workers had or unemployment, or engage in other work but income not as wide for a long time to work on. More importantly, the Gospel! However, the workers into the factory gates after through the organization, command, order the workers to produce higher value products of their labor; Finally, business owners with these products back to the field of commodity circulation, again through the exchange of equal value realization and completion of the remaining .
quite understand all aspects of the above, are not transaction costs such thing. is not it? capitalists seem to be effortless to find all the details of the customer and their needs to determine what to produce and how much to produce; capitalists also found to be little effort to hire labor and other production factors, to determine at what price, what is the number of elements of employment contract; capitalists do not even pay the supervision and management efforts, we can make the team more than team members automatically Personal Products arithmetic sum of the product. In this context mm was only in this context that we certainly agree with Marx mm Comments: Nature.
problem is that in the real world will never be zero transaction costs. general goods and services, such as buyers and sellers, special, such as capitalists and workers, between them found each other on the market, contracting and performance, will pay a high cost. transaction costs are not zero, there is neither automatically coordinate supply and demand, production and other items of organizational functions, is not of the level is determined by market competition, the competition mm entrepreneurs and entrepreneurs, workers and workers competitive, commodity buyers and buyers of competition and the seller of goods determined by the competition mm.
capitalists use their course The relative scarcity of seeking higher returns. like a human, like any market, capitalists may also be in the performance of the contract process, abuse, damage to the other shareholders mm stakeholders, various creditors, workers down the supply chain, product dealers, and even the interests of customers mm. people can use the all the functions of the same vendors. in the real world, people act to save transaction costs and increase transaction costs of the behavior of profits mm mm both can often mixed together. whether an act which led the economy, depends on the constraints of reality Conditions mm customs, moral, legal and practical implementation of the law.
case, what is in the process of how to deal with the real capitalists do? derived from the former Soviet Union model of a revolutionary conclusion mm However, this way, the capitalists, the cost of saving transaction costs and organizational functions also be eliminated out. The problem is that transaction costs have not been eliminated with the disappearance of the capitalists. socialist economy still faces save construction costs, production costs , system costs and organizational costs of serious problems. results, the capitalists thrown to the ground in the socialist countries, had to play by their own (Lenin) to manage the national economy. decades of practice shows that the central planning system is not only extraordinarily high operating costs, but also did not completely eliminate the replace the capitalist exploitation; in the Of course, to be reflective. Xiaoping does not allow private enterprises to take hold again crushed a stick, adhere more to try, see more, aimed at exploring the complex issues dealt with separately in the path. the former Soviet Union and China, the lessons of history remind their Reform of China's policy makers, why not take the capitalist economy with socialist entrepreneurship, market sense, the ability to organize and coordinate production with abandon it?
Deng Xiaoping entrepreneurs invited back to China. He soon headed to China to the history of highly affirmed the economic model. Xiaoping has to use his political authority, many of the the presence of entrepreneurs, are you really against socialism?
more and more people come to the right answer. With the presence of entrepreneurs is widely considered to be When entrepreneurs start of the Chinese people once again become a right (the rights). reform, China has issued several policy documents, adopted many laws, and several amendments to the Constitution, and gradually to recognize and protect the freedom of ordinary people contracting , the founder of various types of enterprises, the investment income of the legitimate rights of the Distribution. According to a release authority, to the end of 2007, China's private economy accounted for about 50% of GDP, 70% of non-agricultural employment, tax 30-40 %. This is the pre-reform can not imagine in any case.
Third, the idea of invisible hand
starting from May 1985, Deng Xiaoping for several years to promote the originally by the State and control prices, to be released by the market. Previously, China has formed a supply and demand determines the price. the transitional regime, a significant boost in yield, but also caused confusion in the distribution: the same product of the that any determined to promote the price reform, solve the problem.
price reform is known as .
1988 �� 7, the State Council announced the opening of famous name cigarette prices. This is in fact a prelude to a tentative .8 mid-May, the CPC Central Committee Political Bureau meeting adopted the , the communiqu�� issued the same day, appeared across the country rush to buy food and daily necessities residents, but also flocked to the wave of bank runs deposits. Ten days later, the State Department announced to strengthen price management, price adjustments are no longer issued to enhance the interest on bank deposits fully .9 months rectifying the market order, the CCP Politburo decided to launch a nationwide reform. China has entered a period of three years (1989-1991) of the Deng Xiaoping once again in the spring of 1992, struggling to push forward China's reform. He retired with a 88-year-old as the elderly, published the famous Southern Talk mm The problem: insist the planning system is not equivalent to allocation of resources is the way to the socialist road can also take the market.
driven by Deng Xiaoping, the Chinese again in 1992, Dawn of the price off. This year, the new release of production and transportation prices up to 648 kinds of , 50 prices of agricultural products, including the country 844 counties (cities) within the opening of the decades-long state purchase of grain by the state price, and the opening of the desalination and all other medicines the price of light industry products. In the spring of 1993, China's total social retail goods 95%, 90% of the total purchase agricultural products and the production of 85% of total sales of all open market supply and demand decisions. market price mechanism in the allocation of resources However, why Deng Xiaoping also on the See the hand! This Is Why?
To answer this question, I think that involves three levels. First, the substance of Soviet-style planning system is to accomplishing the entire national economy of a super-national companies. The company had to bear the super-state great organization and operation costs: all of the information collection requirements and production costs, the costs of decision-making and command, and the discovery of the error and correct the cost, and so on. As the first generation of the pre-reform Communist leadership, a member for many years to deal with the State of Deng Xiaoping front-line services, almost the super-state, chief executive of the company. is because of the cost of the original system overwhelmed the feeling of pressure, but also the efficiency of the original system very satisfied, Deng was forced to be more aware than outside critics, The main result of excessive concentration of power, it is precisely the exercise of state power can not be effective. History has pushed the executive position of decision makers, Deng is determined to reform, a matter of course.
Second, Deng Xiaoping initiated the opening, inspired a generation of Chinese people, but also inspired him. As in 1978-1982, a Beijing university student, I feel that a few years on China's surging economic development, new ideas, new impulses, without exception, are from many years of closure ...