CONFIDENTIAL
role of commodity production, the law of value and the
market
There was an excessive egalitarianism in
the distribution of income.
There was irrationality in
the economic structure
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There may have been a political factor too. During the 1950s,
China was prepared, indeed eager, to learn from the Soviet
Union about "socialist construction". But by the late 1970s
the situation had changed. The Soviet model had not proved
an outstanding success, either in China or in the Soviet Union
itself; and China may have been keen to show that she was
ready to go her own way economically as she had been in other
ways.
GROWTH TARGETS
8.
The purpose of the reform programme is to galvanise China's
economic development. It is therefore related to, though
conceptually distinct from, the targets for development which
have been set by the leadership. These targets are very
ambitious. The two which are mentioned the most often are to
quadruple the 1980 value of gross industrial and agricultural
output by the year 2000 and to raise annual income per head
from $300 to $800 during the same period (both in constant
prices). These targets imply annual growth rates of 7.2% for
gross industrial and agricultural output and of about 6% for
national income (allowing for a population increase of 200
million). So far, the required rates of growth have been
achieved. But for a number of reasons (some of them discussed
CONFIDENTIAL
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