ABSTRACT
This chapter attempts to outline and trace the origins of the major features of China’s developmental approach. It highlights the fact that there has been, and still is, a downplaying of the importance of individual material incentives in favour of reliance on collective material and moral incentives. The Chinese pattern of development did not emerge fully grown overnight, but rather has evolved in response to changing circumstances. It is derived from a synthesis of traditional Chinese models of production, from the Yenan heritage. The Chinese economy in 1949 was shattered from these imperialist depredations and the disruptions of nearly fifty years of continual warfare. In the nineteenth century there had been wars against the British, French, Russians and Japanese. The Chinese economy was in dire straits and the scourge of mass famine loomed threatingly. Without any agricultural surplus, light and heavy industry could not sustain their high levels of production and output slackened off.
