"In time of difficulties, we must not lose sight of our achievements." This quotation from the Communist leader Mao Tse-Tung (1893-1976) could perfectly apply to his economic policy. When Mao came to power in October 1949, China was out of a decade of war and its economy was still very backward and when he died in 1976, Chinese economy had made significant progresses in many fields, but China was still an underdeveloped country in comparison with Western countries, or even with Asian countries such as Japan or South Korea. After 1978, China felt the need for reforms and took the path toward "Socialist market economy" and now it seems that there is nothing left of Mao's era. Given the high growth rates reached by China during the last two decades when it seems to have got rid off its Maoist heritage and the denunciation campaigns Mao has been the target of, we may wonder if it is possible to find any positive achievement from Mao's period. In other words, did Mao achieve to improve the Chinese economy, or on the contrary, did he slow down the Chinese "take-off" (Rostow)?
[...] But, as we will see in a first part, even if Mao's reforms have been mostly successful in the short run, they had some positive consequences in the long term too. Nevertheless, our second part will highlight that many bad impacts of Mao's policies balance them. In the short-term, Mao's reforms can be considered as successful in many ways. Primarily, Mao has been undoubtedly able to bring China's economy out of the Middle Ages. Indeed, in 1949, the Chinese economy was really backward and China was just out of a decade of war which had severely damaged its industry and its agriculture . [...]
[...] Then, after the collectivization took place, the yield in grain crops double within a few years, indeed the collectivization process has been very efficient in mobilizing labour and rural resources notably for large-scale construction projects. Thanks to the first waves of land reforms, Mao managed to suppress the landlords as a class and to equalize the living standards in the countryside[8]. Mao's authoritative government has also been able to reduce the inequalities between provinces, by transferring wealth from the richest provinces to the poorest, by investing in firms in the poorest areas to help their economic development.[9] . [...]
[...] Indeed, in 1949, the life expectancy was of only 35 years but then China has been able to curb a lot of infection and parasitic diseases thanks to better water conservation, an improved hygiene, medical equipments and efficient prevention campaigns. Moreover, huge progresses have been made in education: at the end of the World War II the illiteracy rate reached 80%[12] and it has been reduced to 40% of the adult population at the end of Mao's era, thanks to massive enrolment into primary schools.[13] Significant progress was also made in technology: China developed new and modern industry such as automobile, electronics, petrochemical and nuclear industries are cases in point. [...]
[...] One of the major problems caused by the planned economy has also been the problem of lack of incentives: since the wages were calculated on a strictly statistical way and since most staples were strictly rationed, there were no incentives for extra efforts. Although in the first years of the People's Republic of China, Mao managed to mobilize people, even people previously working for the former government, to work hard for the Chinese revolution; within a few years the lack of incentives became obvious in the industry as well as in the agriculture. [...]
[...] Indeed, the emphasis has been put more on an increase of the intensity of labour than on the introduction of new techniques since, compared to the state investment in industry, the state invested very few in agriculture: only of the State's planned capital construction investment was devoted to agriculture[20] Moreover, the redistribution of land led to a reduction of the average size of farms, which damaged the productivity and reduced the ability of accumulating capital. As Chu-yuan Cheng puts it “agricultural collectivization succeeded more in equalizing the distribution of peasant income than on promoting agricultural output”[21]. [...]
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