ABSTRACT
China has been growing more rapidly than any other developed or transition economy. Between 1949 and 1978, China was a planned economy of the Soviet type, and Chinese planners still exercise strong leverage over the allocation of investment resources. Planning in China has been supported by widespread job assignment, which largely replaced the free labor market after 1957. Although reformers have revived the latter, the system of job assignment still plays an important role within the state sector. Before the start of economic reform, China was in principle an egalitarian society, although the trappings of egalitarianism have been shed rapidly during the 1990s. Even though China is a poor country, most of the basic necessities of life are still inexpensive in urban areas for those who have access to them. In China, steep sales or turnover taxes plus large markups of retail prices over costs keep prices of durable consumer goods high.
