This essay outlines main difficulties in the transformation of the Chinese economy from a centrally planned one to a market oriented. It is argued, that China’s transition has brought great challenges but this can be mitigated with a shift in thinking from size to quality of economic growth…
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This paper is one of the best examples of objective analysis of the macroeconomic situation in China through the recent years of macroeconomic transformation. Being the most populous country in the world, China set out to transform its economy from a centrally planned one to a market oriented one in 1978. This transformation came after the regime of Mao and is seen to take place in two stages: between 1979-1993 came the first stage and the second stage began in 1994 to presently. The two stages are primarily differentiated by the 1989 Student Movement.
Multinational Corporations developed interest in China and, since it presented unique marketing issues and challenges. These MNCs anticipate the growth and expansion of these economies and have thus endeavored to expand their operations to them.
The greatest challenge facing China’s transition is structural impediment existent within the economy particularly with state-owned enterprises and state-owned banks; where both have interrelated problems that the state continues to intervene in their investment decisions and capital allocation. The state sector has set up several state-owned enterprises with supposed policy loans from the state-owned banks to prevent bankruptcy.
The Chinese government has directed large amounts of funds into infrastructure and other projects leaving the budget at deficit levels; all this in a bid to fuel economic growth. The transition has been riddled with corruption primarily in the central and regional governments as well as in the commercial sector.
This has made it difficult to undertake relevant projects beneficial to the public and not specific individuals. Beijing officials have attempted to end this by running public anti-corruption campaigns and holding trials of senior party officials in public. Nonetheless, it has continued to exist and this has made the public averse to social reforms. This has created the problem of rising inequality and in turn an overpowering middle class; which results in a shrinking workforce
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(Chinas Transition to a Market-Oriented Economy Essay)
“Chinas Transition to a Market-Oriented Economy Essay”, n.d. https://studentshare.org/macro-microeconomics/1482495-chinas-transition-to-a-market-oriented-economy.
Market Economy Market economy insinuates the relationship between the quantity of goods in demand, and their pricing according to Altvater (1993). With such factors in consideration, the market will have to shape its demand for the products in the market depending on the prevailing prices.
China’s Economy China has achieved a miraculous economic growth, which has ensured that the country enjoys economic dominance and might surpass the United States. According to Subramanian, (2011), ECONOMIC DOMINANCE IS THE ABILITY OF A STATE TO USE ECONOMIC MEANS TO GET OTHER COUNTRIES TO DO WHAT IT WANTS OR PREVENT THEM FROM DOING WHAT IT DOES NOT WANT.
Two such economies are compared, namely China and Russia, the former being located in Asia and the latter (partially) in East Europe. The focus is on the characteristics of both transition processes, and this is followed by a discussion of
The author effectively and directly answered the questions chosen immediately as stipulated in the first few sentences of the introduction. However, one suggests that as a general rule, an overview of the topic should be provided in the first few sentences of the introductory paragraph relating to China’s economy in general.
Applied to an economy, perfect competitive economy would refer to a free market where there would be existence of the private enterprises and the price would be determined in the economy by the demand and supply in each of the markets. There would be no intervention on part of the government to control the prices or the quantities in the market. A monopoly market is one in which there is a single seller who would have the entire market power and hence the buyers in the market would be the price takers and would have to pay the monopolist-set price in order to purchase the product.
China has continued to dominate the world, despite its huge population of 1.3 billion and the low birthrate. However, despite the fact that the country has experienced rapid economic growth, it still struggles with poverty (Naughton 3).
This essay primarily focuses on the analysis of the macroeconomic statistic in China, as an emerging economy, from the year 2004 to 2013. Recent economic trends in Chinese economy are evaluated. An emerging market economy can be defined as that market economy which is growing from a small economy towards the level of advanced world economies.
The methods used by China have produced growth via organizational as well as government structure, nevertheless, the successful application of this approach for other developing nations is unclear due to the varying degrees of society, government involvement, and the overall economy.
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