Given this history of economic reform, it is.
evident that "under the present system economic questions are necessarily political questions" (Dorn 43). Once Deng and.
his faction had prevailed, it was necessary for some sort of economic reform to evolve.
The initial form the new economy took was not a radical one. China was "still a state in which the central government.
retain[ed] the dominant power in economic resource allocation and responsible local officials work[ed] for the interest of.
the units under their control" (Solinger 103). However, as time passed, some basic aspects of the old system were altered.
either by design or via the process of what might be called benign neglect. As Shirk points out, in rural areas,.
decollectivization was occurring: "decision making power [was being transferred] from collective production units.
(communes, brigades, and teams) to the family" (38); purchase prices for major farm products were increased (39). In.
1985, further reforms were introduced. For example, long-term sales contracts between farmers and the government.
were established. In addition, in an effort to allow the market to determine prices, "city prices of fruit and vegetables, fish,.
meat, and eggs, were freed from government controls so they could respond to market demand" (Shirk 39). Most.
importantly, "a surge of private and collective industry and commerce in the countryside" (Shirk 39) occurred. This.
allowed a great percentage of the populace to become involved in private enterprise and investment in family or group.
ventures. The conditions also allowed rural Chinese to leave the villages and become involved in industry in urban centers.