ABSTRACT
The Chinese economic reform movement, started by Deng Xiaoping in the late 1970s, has been a roller-coaster experience for Shanghai. At the outset of the reform, the city led the nation's provinces in virtually all important economic categories such as Gross National Product (GNP), industrial output, export and government revenue. 1 However, during the initial phase of the reform (1978-1984), Shanghai had great difficulties in keeping up with the changes and digesting adverse consequences. As a result, Shanghai's economy grew slower than the national average for consecutive years for the first time after 1949; local revenue, 2 once a cash cow for the national coffers, became stagnant; and the city's industrial products, almost always the envy of the nation, were severely challenged by the rising provinces such as Guangdong. In short, Shanghai in the mid-1980s appeared to be a laggard in the reform and a loser in a comparative sense.
