Economic Reform: Decentralization 1984–88

Abstract

Between 1984 and 1988 there were dramatic changes in China’s reform policies. First, enterprises became the focus of the reform and decentralization was formally adopted as the programme on a national scale. On 10 May 1984 the State Council published one of its most important policies endorsing decentralization: ‘Temporary regulations on further expansion of autonomy in large and medium-sized state enterprises’ (guanyu jinyibu kuoda guoying gongye qiye zizuquan de zhanxing guiding), granting enterprises autonomy in 10 areas. These were production planning, product sales, pricing, supplies, the use of capital retained from profits, disposal of unnecessary assets, management of labour and personnel, organizational design, rewards and salary/wage setting and the formation of industrial groups among enterprises. This policy was the first to legislate the scope of enterprise management.