chapter  10
42 Pages

Growth and Fluctuations in the National Economy

WithChu-yuan Cheng

This chapter discusses the reliability of statistics on the Chinese economy, examines the quantitative trends of the Chinese economy between 1949 and 1979, analyzes the underlying causes and implications of its economic fluctuations, and explores the future pattern of Chinese economic growth. The statistical data published in the 1970s have covered mostly industries with high growth rates, and relatively few figures have been released for industries with only a mediocre performance. In the industrial output indexes, growth rates in the 1949–1959 period came very close to the official figures. With respect to agricultural output, during the 1949–1978 period, the average annual growth rate was 3.9 percent based on the estimated series, and 4.3 percent based on official data. The incessant fluctuations in the Chinese economy under a central planning system have drawn attention from economists in Chinese studies. Fluctuations in the growth rates of the nonagricultural sectors, particularly industrial output, are primarily affected by the volume of investment.