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In the late 1970s, Chinese industry was on the verge of collapse. Its high but erratic rate of growth since 1949 had been achieved by using ever-increasing amounts of labour and capital. Not only was industry operating inefficiently, but the output mix was inappropriate and inventories had accumulated to very high levels. However, the true state of affairs had been obscured by the political turmoil of the Cultural Revolution (1966–76) and the virtual disbanding of the State Statistical Bureau (SSB).

The gross value of agricultural output in the People's Republic of China increased as much in the eight years from 1978 to 1986 as it did in the 21 years from 1957 to 1978. In per capita terms, the average annual rate of growth rose from 0·4 per cent to 4·8 per cent, the most rapid growth for any comparable period since 1949. How was this dramatic turnaround achieved?

Since the death of Mao Zedong in the autumn of 1976, Beijing's economic advisers have been trying to explain what went wrong with the Chinese economy during the past 25 years and, in particular, why the growth of productivity has been so slow. Their findings are pieced together in the series shown in Tables 1 and 2. These Figures demonstrate the impact of the Leap Forward (1958–60), the Cultural Revolution (1966–69), and the final struggle against the “gang of four“ (1976).

This article presents data on the gross value of industrial output (GVIO) by province for the years 1949–73 and shows their relationship to GVIO figures published for the People's Republic of China (PRC) as a whole. From the founding of the People's Republic on 1 October 1949 until the Great Leap Forward in 1958, Chinese statistical authorities made conscious and sustained efforts to copy Soviet statistical organization and practices. Consequently, the Chinese statistical system, as it developed in the 1950s, mirrored the Soviet system. Descriptions of the Soviet statistical system give valuable insights into the functioning of the Chinese system, and an understanding of problems noted in western studies of Soviet statistics has often been important to an understanding of statistical data from China.

Between mid-1977 and mid-1979, the average annual rate of growth in Chinese industry fell below 5 per cent, and it appeared that the Chinese would not be able to fulfil the annual plan for 1979, especially in light industry.1 As it turned out, however, output surged in the second half of the year and the targets shown in Table 1 were met easily.

Mao Zedong, dissatisfied with the growing ossification of the Party and government bureaucracies, in the spring of 1966 launched the Great Proletarian Cultural Revolution. He believed that China's youth required a "revolutionary experience" to renew their faith in a revolution that had taken place before most of them had been born or were old enough to remember. The Cultural Revolution (1966-76) quickly became a period of widespread, often violent, social upheaval that affected the performance of industry. Hua Guofeng summed up its effects when he said

The performance of the Chinese economy is a subject of great interest to many people, and a number of western scholars have put considerable effort into estimating the growth of China's national product, but no one has made use, either directly in his calculations or indirectly as a check on his work, of the aggregative data that Premier Chou En-lai gave to the late Edgar Snow during the winter of 1970–71.

The goal of the Chinese Government is to make China an efficient, modern economy by the end of the century. This goal was articulated by Premier Zhou Enlai in 1964 and 1975, and made public by Premier Hua Guofeng in February 1978, but a serious attempt at fundamental change was not begun until the strategic shift in economic policy following the Third Plenum of the 11th Party Central Committee in December 1978. Since then the Chinese have undertaken a bewildering variety of experiments and reforms in industrial enterprises. These experiments started on an extremely small scale, primarily in Sichuan, and then spread rapidly throughout the country. In 1982, however, after five years' effort, one enterprise in four was still operating at a loss.

By 1975, after a period of widely divergent estimates for Chinese grain production, a consensus appeared to be emerging. Consider, for example, the estimates that were published at the time (in million tons):Not only was there a consensus, but it was widely assumed that the figures were consistent with those published in the late 1950s. Since then, evidence has been accumulating that the definition of grain has changed and that not all of the figures released in any given year conform to the definition commonly used at the time. We will review the changes in the definition of grain and present our interpretation of the data that have been released in the past 20 years.

The increase of 13·5 per cent in 1978 masks a remarkable slowdown in the rate of industrial growth in China. The data in Table 1 suggest that the gross value of industrial output (GVIO) has been growing at an annual rate of less than 5 per cent since the end of 1977 – which is less than half the average annual rate projected for the 10–Year Plan period (1976–85).

How much grain does Communist China produce? Is total production over 200 million tons, or is it as low as 175 million tons? The purpose of this brief article is to explore the differences among presently available estimates of grain production in Communist China and to point out some of the implications of these differences.

For the years before 1958, because Communist China published data on the physical output of a large number of industrial commodities, it was possible to construct an index of industrial production that could be used with confidence. As early as 1959, however, there was a noticeable drying up of official reports as a source of data and objective commentary and, since the collapse of the Leap Forward in 1960, the regime has imposed an almost complete blackout on the disclosure of specific economic facts and figures. As a result, the number of commodities for which physical output can be estimated has been reduced sharply, and the estimates are subject to a wide range of error.

The machine-building industry covers a very wide field: rolling stock for railroads, blast furnaces for new iron and steel complexes, trucks and tractors for agriculture, bicycles, radios, clocks and thermos bottles for personal use, not to mention thousands of other commodities. An interest in any of these things or in more aggregate measures such as the volume of construction or the growth of industry, presupposes an interest in the machine-building industry. As it was put in the first Five-Year Plan, "The machine-building industry is the key to the technological transformation of [the] national economy."' In spite of a general recognition of its importance, however, there is no agreement among students of the Chinese economy on how well the machine-building industry has performed. For example, compare the following index numbers (1952=100) which have been calculated for 1956 2: Official 406

Communist China has not published official population statistics for any date since 1 January, 1958, when it claimed a total population of 646,530,000 persons. For nearly a decade after that, the rounded figure of 650 million was given almost without exception. On 11 March, 1966, however, a figure of 700 million was cited for the first time by Lin Piao in his letter to the Industry and Communications Front, and in August it appeared again in the communiqué of the Eleventh Plenary Session of the Eighth Central Committee. More recently, the figure 750 million was used in a speech at a workers' congress in Lanchow on 10 February 1968.

The Chinese have broadcast a number of statements on industrial performance in Kweichow during 1977. Piecing these statements together shows that the political events of the past two years–the death of Chou En-lai, the activities of the “gang of four,” the death of Mao Tse-tung, and the struggle over the restoration of Teng Hsiao-p'ing-have seriously disrupted production. Even though Kweichow is not a major industrial province, the results are worth considering because they give month-by-month changes in industrial production from January through October 1977 as well as levels of output for two months in 1976. The level of industrial output in Kweichow was depressed for more than 12 months far below that of September 1975, the previous peak month. This pattern may be similar to declines in industrial production in other more important provinces for which similar but much more fragmentary statements have been broadcast.