Transition. Development and Government

Author: Hu Jiayong (Editor-in-Chief)
Publisher:
Publish Date: 2003-02-01
Features: This book integrates theory with practice, providing a profound discussion on the transformation and repositioning of government functions during China's economic transition, as well as the role of the government. Its key feature is a comprehensive elaboration on the theoretical perspective of the "effective government." The book consists of 16 chapters, covering topics such as price mechanisms, government and food security, government functions and commercial systems, government revenue structure analysis, government expenditure structure, monetary policy analysis in transitional China, the reform of the social welfare system, the role of the government in economic development, government and regional economic development, rent-seeking and corruption.
The essence of economic transformation is government transformation. In microeconomic fields, the government should shift from being a price setter to a price-behavior regulator, ensuring that prices reflect their true nature. Regarding food security, the government should avoid playing a solo role and instead fully leverage the active roles of markets, grain merchants, and farmers. The government must withdraw from general circulation and take on the role of a guardian of market order. In macroeconomic fields, the government should use fiscal and monetary policies to create a stable and balanced economic environment. To this end, it must reform microfinancial institutions, strengthen the independence, authority, and scientific decision-making of the central bank, establish an effective monetary policy transmission mechanism, and improve the effectiveness of monetary policy. The government must also transform its revenue and expenditure behaviors, establishing a unified and standardized structure that aligns with the market economy and policy functions. In the realm of economic development, the government should play a leading role in establishing development frameworks, providing basic development conditions, and building social security nets, while treating the market mechanism as the fundamental tool for economic development.
To avoid government failure and establish an effective government, it is crucial to use institutions to suppress corruption.