However, the combination of power and modernity with a strong commitment to socialist values and to the spirit of self-reliance lends China its peculiar distinctiveness as a development model.

From the standpoint of the Chinese Communist leadership one of the most crucial aspects of socialism is the striving toward egalitarianism. There has been no pretension that egalitarianism has already been attained, but there was a determination by Mao and some other leaders as well, especially after the Cultural Revolution, to avoid programs and methods that lead away from rather than toward this ideal. Therefore, measures that may speed industrialization and modernization but contribute to a widening of income differentials encountered resistance. Similarly, the pursuit of socialism without regard of its impact on economic growth was also likely to be opposed. At any one time and in a specific situation there may be definite trade-offs between these two sets of objectives. Some leadership figures and cadres may be expected to assign a higher priority to growth and modernization in a particular situation than to egalitarianism and/or self-reliance. This leads to periodic shifts in policy as leaders are realigned and their power and influence either waxes or wanes. Such shifts may also occur as perceptions of key policy makers change over time and in response to changing conditions.

At least on Mao's part, the pursuit of egalitarianism involved a constant struggle against the rise and crystallization of a "New Class." However, many elements of the bureaucracy are anxious to protect their power and privileged position. Moreover given Mao's adherence to the principle of "democratic centralism," reduction of status differences did not mean a dispersion of political power, even in his own mind. This has led to ambiguities and a series of built-in contradictions, which have become the source of a multi-dimensional struggle. In the course of this struggle, some elements emphasize the "democratic" aspects involving mass participation and the reduction of status differences, while others stress "centralism," that is, the need to concentrate power.

This continuing struggle is also reflected in periodic drives to compress the wage structure and to narrow wage and salary differentials. The 1975 campaign against "bourgeois rights" was in part directed at these income differentials both in industry and agriculture. In agriculture this is to be accompanied by reducing and eventually abolishing the private plots, by gradually substituting the brigade for the team as the basic unit of accounting and income distribution in the commune, and by developing the backward areas.2

It is far from clear to what extent such compressions in income differentials narrow the scope of material incentives and thereby undermine work effort and the pursuit of higher skills and labor productivity. In the absence of firm evidence to the contrary, it could be argued that even if differentials were narrowed but not eliminated they could still serve as incentives, particularly if material rewards are supplemented by psychic appeals. Therefore, the narrowing of income differentials-depending on how far it goes in the direction of leveling-need not in and of itself retard industrialization. and modernization.

This was clearly brought out in Vice-Premier Hua Kuo-feng, "Summing-up Report at the National Conference on Learning from Tachai in Agriculture," Peking Review, vol. 18, No. 44, Oct. 31, 1975, pp. 7-10, 18. This was a high-level conference concerned with agricultural policy and agricultural development strategy convened for a whole month in September-October 1975.

As noted above, even Mao and his closest allies recognized that "democratic centralism" requires concentration of political power at the top. However, they wanted to prevent differentiation in power, role, function, and income from becoming frozen into status and class differentials. In spite of the Cultural Revolution, this objective does not seem to have been realized thus far. On the contrary, as one travels around China and meets peasants, workers, cadres, and high ranking government officials, status differences are clearly apparent in many subtle ways, such as dress, bearing, deference by others, and many other privileges that surround power positions in all societies. These are among the considerations that have prompted periodic campaigns to break down the barriers between mental and manual labor on the one hand and urban and rural areas on the other. These campaigns and measures have contributed to a development approach that might be considered characteristic of a Chinese model. This concern with status differences was also one of the reasons for abolishing all insignia of rank in the army and for discouraging too explicit identifications of roles and titles since the Cultural Revolution. These considerations also play a role in the periodic attacks on the technocratic approach to economic, military, and administrative management, on professionalism and expertise in contrast to "redness." They also must have influenced the drive for the expansion of rural smallscale industries. While this is prompted by many other considerations (to be brought out in the next section), it serves to narrow the social and cultural distance as well as the technological and the "modernity" gap between factories and farms, city and country.

These concerns are also reflected in the hsia fang (down to the country)—the rustication-movement, which leads to the mass migration of youth from the city to the country. This more or less involuntary movement transfers a relatively well-educated manpower pool to the countryside and thus provides a resource for developing leadership and skill and for raising the educational levels of the peasantry. At the same time it deprives the city of a potential pool of talent and creates on the part of some of this youth a sense of frustration and alienation, brought about by difficulties of adjustment to an unfamiliar and harsh physical and cultural environment.3

Perhaps the most significant aspect of the rustication movement is that it reverses the flow of migration normally associated with the process of economic development. Large-scale rural-urban migration under the impact of rapid industrialization caused a great deal of concern in China in the 1950's. The press and official statements were replete with complaints concerning the "blind migration to the cities." More remarkable, and probably unprecedented in contemporary development experience, is the fact that an estimated 12 million young people have been "sent down" to the country from the city since 1968.*

However, this movement was not only prompted by a desire to break down barriers between city and country. Chinese planners and policy makers have for some time wanted to check the further growth of their largest cities for a number of reasons. They recognize that urban growth requires large-scale investments in social overhead

These frustrations and difficulties of adjustment occasionally surface in the Chinese press. They are buttressed by accounts of Overseas Chinese who have an opportunity to visit their native village and by the high incidence of this youth among the Chinese migrants to Hong Kong.

• Peking Review, vol. 19, No. 2, Jan. 9, 1976.

capital such as schools, hospitals, new housing, and other facilities, none of which are directly or immediately productive. For instance, one of the vice-chairman of the Shanghai Revolutionary Committee told the author in December 1972 that the population of Shanghai city has decreased in recent years; as of that time the population of the city proper was 5.7 million, that is, it was reduced to the 1953 level. He then went on to point out that administering a large city like Shanghai is an enormous and complex task. In his view it would be desirable, but unfortunately not possible, to reduce Shanghai to a city of 2 to 3 million.

At the same time, there are a number of indications that while the largest cities have stopped growing, intermediate and smaller cities are continuing to expand. In this way there is a continuum of cities in terms of size, a hierarchy of national, regional, provincial, district, and local centers. This hierarchy facilitates the communication and diffusion of new ideas and influences from above and needs, aspirations, and demands from below. In effect it also serves to narrow the distance between the largest centers and the masses.

The reduction of barriers between mental and manual labor is also fostered by the periodic tours of duty of urban cadres in communes. These tours may range from one to several months of farmwork. However, since the end of the Cultural Revolution they have become more routinized and ritualistic, typically involving temporary duty of at most a few months. They are paralleled by the sending down of agricultural and other scientists to factories and farms to carry on either highly applied research specific to the locality or to adapt research findings to local conditions. Agricultural scientists are thus sent down to the countryside to perform what in effect amounts to farm extension tasks. Similar considerations may lead to the assignment of physical scientists to factories. In the same spirit, as a general rule, students are not admitted to universities unless they have had at least 2 years of experience on farms, in factories, or in the army. Moreover, while studying at universities they are once more assigned to factories for periodic tours of duty. At the same time, so-called workers' universities have been established in a certain number of advanced factories to raise the technical and educational level of the workers.

These measures clearly entail both benefits and costs. They undoubtedly contribute to the more rapid diffusion of advanced methods in factories and on farms. They may also reduce the psychological and attitudinal barriers between manual and mental workers. However, this has almost certainly led to a watering down in the academic and scientific quality of university training since the Cultural Revolution. Available evidence suggests that at least in some fields scientific research has also suffered.

It could be argued that an optimal strategy for an underdeveloped country would be to let industrially advanced countries bear the full cost of advancement in fundamental science and then merely borrow the findings and apply them to local circumstances. While this approach makes a lot of sense, it must be applied judiciously in a large country which is in the pursuit of increasing its power. Thus not all scientific findings travel freely across boundaries. Some have sensitive security implications and therefore may need to be developed by a country such as China more or less independently. But perhaps more importantly the adaptation of scientific findings to local conditions.

may require considerable scientific capacity itself. For instance, by assigning agricultural scientists to what may amount to extension work, Chinese planners may have contributed to yield improvements in the short run at the expense of the long run. That is, continuing yield improvements in China will require fundamental advances in plant breeding, in farm practices, and in agricultural science. If scientists are in communes instead of laboratories, then the development of agricultural science is bound to be retarded.

In Chinese official pronouncements and statements the goal of self-reliance is usually linked to the pursuit of a "powerful modern socialist country." The self-reliance policy as usually stated in recent years involves "maintaining independence, keeping the initiative in our own hands and relying on our own efforts." In fact, self-reliance as a development objective was already brought to the fore in the late 1950's. However, its salience and importance were markedly increased following the Sino-Soviet break in 1960. It encompasses several concepts and traits, with the prominence and emphasis given to each of these changing from time to time.

Thus self-reliance as an operational policy has been applied in several different contexts and for different purposes. First of all, it can serve as an important source of normative appeals, as can so many of China's long-range objectives. That is, it is used as one of the means for building pride in individual accomplishments by workers and peasants, factories and communes, cadres at all levels, and state organs. In this way it serves as a means of exhortation to maximum effort.

It also can carry with it a strong autarkic connotation. In a national sense it implies minimizing China's vulnerability to foreign economic pressure, particularly in the light of the Sino-Soviet break in 1960. In this sense self-reliance carries with it strong nationalist, exclusionary, and security (defense) connotations. These are explicitly brought out in another of Chairman Mao's frequently quoted directives, "dig tunnels deep, store grain everywhere, and never seek hegemony"; "be prepared against war, be prepared against natural disasters, and do everything for the people." 7

Self-reliance is also intended to provide a means for minimizing the importation of foreign ideas, influences, and aspirations. In this sense it can serve as one of the means for preserving the purity of China's social system. This leads to minimizing contacts between foreign visitors and their Chinese counterparts-be they businessmen, engineers, and technicians helping in the installation of complete plants; scientists; diplomats; or just plain tourists. Of course, as shown in chapter 7, this policy is not interpreted precisely the same way and enforced with the same vigor at all times. Thus it was interpreted more strictly and narrowly in the later 1960's than in the early 1970's.

However, self-reliance also has many connotations for domestic economic policy, primarily relating to regional and local self-sufficiency. This striving for self-sufficiency is largely rooted in transport barriers and bureaucratic resource-allocation bottlenecks inherent in a central planning system. Both of these stand in the way of supplying local needs. For instance, an American delegation of rural industry

This was identified as a key problem by a delegation of American plant scientists visiting China in August-September 1974; see National Academy of Sciences, Plant Studies in the People's Republic of China, A Trip Report of the American Plant Studies Delegation, Washington, D.C., 1975.

Li Chiang (Minister of Foreign Trade of the PRC), "New Developments in China's Foreign Trade." China's Foreign Trade, No. 1, 1974, p. 4.

7 Chou En-lai, "Report on the Work of the Government," Peking Review, vol. 18, No. 4, Jan. 24, 1975, p. 25.

specialists visiting China in the summer of 1975 found that "even when communes are prepared to pay the going price for some desired item, it will not be necessarily available and they may get it faster if they produce it themselves." Therefore, even if the manufacture of producer goods by rural industries may initially be high-cost and inefficient, this is likely to be out-weighed by the high costs of transporting raw materials and finished goods over long distances and by the administrative delays in obtaining these products from higher-level organs. These considerations then create strong inducements for the expansion of local industries to meet local, agricultural demand for these products.

The desire for self-reliance is reinforced by other considerations as well, such as the urge to decentralize industrial locations and to develop the more backward regions. As with all of the other objectives. and policies discussed above, self-reliance too involves some costs and benefits. To the extent that the objectives spelled out above are actually attained, they can be included in the benefits column of this balance sheet. Depending on how rigidly the policy of self-sufficiency is enforced, it almost certainly entails some sacrifice of the advantages of international and/or inter-regional specialization and division of labor. If these costs outweigh the economic benefits of self-reliance, this would be reflected in a reduction in China's economic growth rate. Furthermore, local and regional self-sufficiency could favor the more advanced as compared to the underdeveloped areas of the country. Consequently, unless there are counteracting policies and tendencies at work, self-reliance policies could lead to a widening of local and regional income disparities.

An attempt to measure the net impact of this policy, the benefitcost balance, would go well beyond the scope of this interpretative synthesis. Such an undertaking would be fraught with a host of conceptual and statistical pitfalls even if the data were available. Factor and commodity price distortions rooted in China's economic system provide an example of one set of problems. Difficulties of measuring long-term training and learning effects resulting from locating industries in rural areas, or of measuring the impact of such policies on regional income distribution, may serve as other examples. Moreover, even if the self-reliance policy were to lead to some sacrifice of growth it could still be pursued for the benefits it offers in terms of socialist, nationalist, or other goals.

FACTOR ENDOWMENTS

One of the most striking and crucial traits of Chinese agriculture is that it feeds about one-quarter of mankind on about 7 percent of the globe's cultivated land. This necessarily means that the cultivated land area per capita is small, so that China is a very land-short economy. This is greatly accentuated by an acute scarcity of capitalless acute now than 25 years ago-as evidenced by a relatively small capital stock or small annual additions to capital stock per person. This may not be so small in comparison with other less developed countries near the bottom rungs of the world development scale, but it is quite small as compared to the more developed countries.

American Rural Small-Scale Industry Delegation, Rural Small-Scale Industry in the People's Republic of China, Berkeley, Calif., 1976 (forthcoming), Chapter 1, p. 8.

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