China: the planned to free market paradigm

Abstract

Reveals that the People′s Republic of China is a market in transition. The Chinese Government wants to modernize the retail industry as part of the movement from a planned economy to a market economy. Reports that a series of interviews with managers of government‐owned department stores and co‐operatives, free market retailers and members of the municipal and federal commercial planning committees began in 1992. One year later, when a second series of interviews was conducted, the retail industry was vastly different. Joint ventures increased and store managers were given the right to choose their own form of operation. Consumers have experienced self‐service food stores and foreign department stores opened in Beijing and Shanghai. A third set of interviews conducted in March 1995 showed that many reforms had been rescinded because of high domestic inflation. Several new retail ventures aimed at the nouveaux riches in China have had to position downwards. Concludes that the People′s Republic of China′s change from a planned to a market economy is a lesson in social and market change.