By Daniel Buck (auth.)
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Extra resources for Constructing China’s Capitalism: Shanghai and the Nexus of Urban-Rural Industries
Official opinion continued to encourage vertical integration throughout 1959 and 1960, as seen in the high-profile campaign for self-sufficiency inaugurated at the Changchun Automobile Plant in May 1960. By 1959, some economists had begun to warn against “indiscriminate verticalization,” and in 1960, Shanghai started to emphasize specialized enterprises (Donnithorne 1967, 168–70). The president of one of the bicycle SOEs related the history of specialization in the oldest bicycle enterprise in Shanghai.
In 1995—the peak year of the SOE-TVE nexus—the SOEs in these six sectors reported a combined total output of 100 billion yuan ($12 billion), about 28 percent of Shanghai’s industrial output (Shanghai jingji nianjian 1996). 18 These six sectors by no means exhausted the extent of Shanghai’s SOE-TVE nexus, nor was it confined to Shanghai and its rural counties and districts, as we have already seen. The opening up of the Shanghai and Yangzi River Delta region in the 1990s would lead to a reversal of its relative fortune vis-à-vis Guangdong.
As we will see, throughout the socialist period, verticalization versus specialization in production was one issue in larger philosophical and policy debates over the direction of the economy. Industrial production was allowed to specialize more in Shanghai than in most of China, but the structural logics of the planned economy also 20 C ons t ruc t i ng C h i n a’s C a p i t a l i s m encouraged factories to become increasingly self-sufficient and vertically integrated. This tendency for factories to become “big and complete, small and complete (daerquan, xiaoerquan)” was still predominant in 1978 and would last well into the reform era.
Constructing China’s Capitalism: Shanghai and the Nexus of Urban-Rural Industries by Daniel Buck (auth.)