GLF caused famine Flashcards
INTRO
Pinning down the exact cause(s) of this famine is clearly a Herculean endeavor. In part data availability presents a problem, but what makes the analysis daunting is that this famine occurred at a time of “profound social upheaval and disorganization,” to borrow the words of CARL RISKIN (1998), which makes it difficult to isolate the effect of a number of relevant factors. This paper will focus on the institutional mechanisms and policies of the GLF that caused the famine.
CARL RISKIN (1998
profound social upheaval and disorganization
In a nutshell, the leap
In a nutshell, the Leap was an unorthodox development strategy conceived to hasten the pace of transforming the Chinese economy from its predominantly agrarian nature into a powerful industrial state.
To achieve this,
. To achieve this, a specific objective of the Leap was to increase both agricultural and industrial output by manifolds, the former by expanding the acreage covered by irrigation and the latter via increasing the capacity of steel and iron production.
As china was severely constrained with
As China was severely constrained with capital and backward in technology, achieving rapid growth via technical change was an unlikely option. An obvious alternative, given China’s abundant surplus rural workers, was to make greater use of these resources by mobilizing them to engage in a variety of industrial and public projects by diverting labour from agriculture to industry and impose excessive burdens of grain procurement on the rural population.
false premise that Collectivisation
The overzealous policies are consistent with a false premise ingrained in the dominant Soviet economic ideology that collectivization would transform Chinese agriculture from small household farming into large-scale mechanized production, achieving a great leap in productivity.
1.The commune movement from GLF reduced work incentives and created conditions for wrongdoing
A game theory hypothesis proposes that the main cause of the agricultural collapse was the deprivation of the peasants’ right to withdraw from the collectives with the communization. This switch in the form of organization changed the incentive structure for the peasants who chose to shirk within the communes because the mechanism of self-discipline breaks down with compulsory participation.
- Misallocation of resources from rural to industrial
The Leap had created an incentive structure of encouraging cadres to overreport grain output, which led to the illusion that China had already produced a huge grain surplus. Under the illusion that the collectivization drive had solved China’s food problem permanently, the government diverted a large amount of rural labor from agriculture to industry. The diversion resulted in a neglect of agricultural work in many regions, sometimes leaving grain to rot in the field.Ecstatic about the sharp increase in grain yields, the government increased state procurement of grain.
3.Excessive procurement, when combined with an actual reduction in productivity caused by collectivization, significantly reduces food available
Under the centrally planned regime, China had an effective, urban-biased ration system in which city residents were given legally protected rights to acquire a given amount of food. In contrast, compulsory grain procurement quotas were imposed on the farmers. As a result, farmers were entitled only to the residual grain. In years of poor harvest, there was barely enough grain left in the village for the farmers after they fulfilled the quotas.
4.implementation of radical programs such as communal dining
The famine was a tragedy of the commons caused by the policy of commune mess halls. The pursuit of individual gains led to excessive food consumption, a result that was detrimental to all commune members. The government also encouraged communes to establish communal kitchens that provided members with free meals, resulting in a great deal of food waste.
We can learn about the general relationship between economic system and economic performance, in China’s case, it identifies a major weakness in central planning.
As decisions became centralized, any policy failure would have economy wide repercussions, thereby exposing the economy to new systemic risks. In addition, the centrally planned system as practiced in China in the late 1950s lacked checks and balances and proved ineffective in arresting the momentum of apparently deleterious policy initiativess
how could glf been less devastating
The GLF crisis could have been far less devastating had local officials not faced strong political incentives to implement apparently poorly conceived policies and to conceal unfavorable information on local economic performance. However, given the design of the system, the observed policies, no matter how irrational they were, were rationalizable within the confines of the system
