China Unbalanced Essay

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In this case study, we will attempt to answer what measures China took in preparation for acceptance into the WTO and how it adjusted to its eventual admittance in December of 2001. We will also review some of the problems associated with China’s economic growth strategy.
We will begin our analysis of these questions by examining China’s economy at the time of Deng Xiaoping’s accession to power in 1978 and the economic growth strategy he and his successor implemented which ultimately led China to ascension into the WTO. We will then review various conditions imposed upon China by the WTO and how China reacted to those changes and to what extent these lead to China’s current status and interaction
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. Xiaoping implemented significant change going from a centrally planned economy run by the state, towards a private entrepreneur market based economy. This transition to a new type of socialist thinking, known as the socialist market economy, proved highly successful as it allowed China to move from a nation in poverty ruled by a single person to the second largest economy in the world. A more sudden or abrupt change could have easily resulted in the fall of China’s economy, similar to what certain European countries experienced in 1991 at the end of the cold war between the super powers.

One of the founding principles of a free market system is to give individuals freedom of choice in how they invest their assets, choose what to consume, improve their knowledge and skills, choose how they will use their income and invest their wealth or assets as they see fit. Xiaoping began his growth strategy by allowing farmers to sell some of their output on the black market with a view of increasing demand, which in turn gave farmers incentive to produce more and increased production surplus. By doing this, not only did the government increase its production surplus, but it also allowed its impoverished citizens easier access to fruit, meat and vegetables and reduced the country’s reliance on food imports to sustain its large population This strategy was an indirect way of subjecting people to competition
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