The Wage Policy in the Period of Planned Economy of China

Abstract

It is well known that economic substructure determines the superstructure. On the other hand, the superstructure has also tremendous impact to the development of the economic substructure. Governments have been actively developing policies and constructing the institutional environment to facilitate and foster the development of their economies. Upholding the continuous economic reform and opening up policy, China has witnessed repaid economic development and exposed to abundant growth opportunities favored by globalization and development of information technologies. Its WTO membership, huge market potential and the about 10% economic growth per annum have made China the focus of the globe.

In order to understand the economic development of China, it is necessary for us to look back to the history of this country. From 1949 to 1978, the period of planned economy, guided by the policy of ‘Distribution According to Work’, Chinese government had sought for fairness and rationality in wage distribution, and set up a standard graded wage system, that is so called ‘eight-grade wage system’. At the same time, another one wage system, ‘piecework pay’, was been set up too. How did the wage system of the planned economy develop and revolute? What are the ‘eight-grade wage system’ and the ‘piecework pay’? What kind of characteristics they have?

From the paper, we can know that the ‘eight-grade wage system’ and the ‘piecework pay’ could not draw out labor-desire in the period of planned economy in China. There was no way for China except reformation.