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Published online by Cambridge University Press: 03 June 2009
There is an uncanny similarity between regulations on merchant activity in various medieval Western European countries, on the one hand, and, on the other, those in the People's Republic of China (PRC) just after its institution (see Appendix). My discovery of this resemblance informed the research on which this paper is based and directed my attention to some crucial relationships in the interaction between commerce and state at a certain level of economic development. The presence of similar regulations in these societies had to point to (1) like activities going on in them all, along with (2) governmental disapproval of these activities. Thus, a preliminary look at materials on Europe led to new insights into the Chinese situation.
I am very grateful to the following people for suggestions of useful references or for helping me to revise earlier versions of this paper: Joel Falk, Cho-yun Hsu, Robert Keohane, John Wilson Lewis, Evelyn S. Rawski, Thomas G. Rawski, Bruce Reynolds, Julius Rubin, Benedict Stavis, Donald Sutton and Charles Tilly. An earlier version was presented to the Workshop on the Pursuit of Political Interest in the People's Republic of China, August 1977, funded by the Joint Committee on Contemporary China of the Social Science Research Council and the American Council on Learned Societies.
1 I am indebted to Bruce Reynolds for calling my attention to this point.
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4 A discussion with Charles Tilly was useful in bringing me to this formulation.
5 Commerce in the southwest nicely illustrates G. William Skinner's model of trade in the peripheral (as opposed to core) areas of a regional economic system. In such places a rugged topography, low population density, and high transport costs limit commercialization and thereby reduce or eliminate competition between markets and firms. See ‘Cities and the Hierarchy of Local Systems,’ in Skinner, G. William, ed., The City in Late Imperial China (Stanford: Stanford University Press, 1977) pp. 277–85.Google Scholar
6 In studies of China, the word ‘traditional’ is loosely used to refer to the China that existed under dynastic rule (before the revolution of 1911 that overthrew the Ch'ing dynasty), or even, at times, to pre-PRC China (pre-1949). The word ‘historical’ could be substituted for it.
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13 Julius Rubin and Tom Rawski stressed the importance here of the risk factor. As Rubin noted, in a preindustrial economy, the very conditions that make high profits possible also increase the risks. Much illicit merchant activity can be seen as attempts to reduce risks. (This is true of efforts to ally with officials and to accumulate fortunes.)
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39 For discussion of these points, see Yün, Ch'en, ‘The Financial and Economic Situation in the PRC During the Past Year,’ (1 Oct. 1950)Google Scholar in New China's Economic Achievements 1949–1952 [hereafter NCEA],Google Scholar compiled by the China Committee for Promotion of International Trade (Peking: Foreign Languages Press, 1952), pp. 96, 100;Google ScholarYün, Ch'en, ‘The Problem of Commodity Prices and the Issuance of Government Bonds’ (2 Dec. 1949), in NCEA, p. 34;Google ScholarYün, Ch'en, ‘The Economic Situation and Problems in the Readjustment of Industry, Commerce and Taxation’ (15 June 1950), in NCEA, p. 64;Google ScholarMu-chiao, Hsüeh, ‘China's Great Victories on the Economic Front in the Past Three Years,’ (1 Oct. 1952), in NCEA pp. 270–71;Google ScholarHughes, T. J. and Luard, D. E. T., The Economic Development of Communist China 1949–1958 (London: Oxford University Press, 1959), p. 27;Google Scholar and Perkins, Dwight H., Market Control and Planning in Communist China (Cambridge: Harvard University Press, 1966), pp. 1–2.Google Scholar
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45 Tse-tung, Mao, ‘On the Policy Concerning Industry and Commerce’ (Peking: Foreign Languages Press, 1968);Google Scholar‘Common Program of the CPPCC,’ translated in Blaustein, Albert P., Fundamental Legal Documents of Communist China (South Hackensack, N.J.: Fred B. Rothman and Co., 1962), p. 48;Google ScholarYün, Ch'en, in NCEA, pp. 105–06 and pp. 69–70.Google Scholar See also HHYP 3, No. 2 (1950), p. 346.Google Scholar
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48 Hsin-Hua jih-pao [New China Daily] (Chungking) [hereafter HHJP], 29 Nov. 1951, p. 1. This was the press organ for the southwest region from 1949 to 1954. Specialized state-operated trade companies were set up first for a limited number of essential goods (e.g., grain, cotton, salt) in early 1950. Later, more companies to handle other goods were also established.Google Scholar
49 HHJP, 6 Jan. 1952, p. 2; 22 Dec. 1951, p. 1.Google Scholar
50 For example, HHJP, 13 Oct. 1951, p. 2; 2 Nov. 1951, p. 2; 22 Nov. 1951, p. 2; 11 March 1952, 17 April 1952, p. 2;Google ScholarSurvey of China Mainland Press [hereafter SCMP], No. 202 (1951), p. 21. This problem with private merchants has cropped up in China whenever the state control falters.Google Scholar
51 HHJP, 13 Oct. 1951, p. 2.Google Scholar
52 For example, HHJP, 14 Nov. 1951, p. 2. Benedict Stavis has pointed out to me the importance of the availability of adequate consumer goods in trying to enliven and reorient local marketing.Google Scholar
53 HHJP, 28 Nov. 1951, p. 2 and 17 Dec 1951, p. 2.Google Scholar
54 HHJP, 28 Nov. 1951, p. 2 and 27 Dec. 1951, p. 2.Google Scholar
55 HHJP, 22 Dec. 1951, p. 1.Google Scholar
56 HHJP, 13 Jan. 1952, p. 6.Google Scholar
57 HHJP, 20 Oct. 1951, p. 2. See also 22 Dec. 1951, p. 1 on cadres ‘blindly adjusting prices.’Google Scholar
58 HHJP, 2 Nov. 1951, p. 2.Google Scholar
59 HHJP, 4 Nov. 1951, p. 2.Google Scholar
60 HHJP, 3 Dec. 1951, p. 2. These cooperatives were meant to act as state-sponsored intermediaries between the companies and the peasantry for both sales and purchases.Google Scholar
61 HHJP, 6 Nov. 1951, p. p.Google Scholar
62 HHJP, 6 Dec. 1951, p. 2.Google Scholar
63 HHJP, 16 April 1952, p. 1. Another, and probably more serious, sort of problem must have derived from the fact that many of those who were private, noncommunist merchants before 1949 must have been employed as state trade cadres. There was a shortage of cadres of all types in the southwest at that time, and it must have been natural to rely on those who knew the local trade customs and networks.Google Scholar
64 See especially HHJP, 6 Oct. 1951, p. 2, which discusses the intended positive functions for this type of organ.Google Scholar
65 HHJP, 9 Oct. 1951, p. 2.Google Scholar
66 HHJP, 11 Oct. 1951, p. 2.Google Scholar
67 HHJP, 12 Nov. 1951, p. 2.Google Scholar
68 HHJP, 12 Dec. 1951, p. 2.Google Scholar
69 For example, HHJP, 13 Jan. 1952, p. 1. Also see 1 Jan. 1951, p. 2, and 11 Dec. 1951, p. 1, and 4 Feb. 1952.Google Scholar
70 See HHJP, 6 Feb. 1952, p. 2; 13 April 1952, p. 1.Google Scholar
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73 See note 63 above.
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91 HHJP, 17 April 1952, p. 2. The Business Federation and the all-circles' people's representative conference were mass organizations instituted by the communists to give concerned people some chance to participate in politics.Google Scholar
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103 HHJP, 16 Oct. 1951, p. 2 contains one of the many articles of this period on this topic.Google Scholar
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123 See, for example, Hong Qi [Red Flag] (Peking), No. 2 (1977), p. 57. Both John Lewis and Julius Rubin pointed out to me the insoluble bond between commerce and commercialmindedness.
124 Richman found old-time capitalists still at work in state-operated economic organs as late as 1965, who ‘at times regress’ and behave as they used to. See Richman, Barry M., ‘Capitalists and Managers in Communist China,’ Harvard Business Review Jan.-Feb. 1967, 57–78.Google Scholar
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126 HHJP,9 Oct. 1951, p.2, 20 Nov. 1951, p.2, 3 Dec 1951, p.2, 22 Dec. 1951, p. 1, 30 April 1952, p. 2. Many of these people were private merchants before 1949, according to Gordon Bennett's interviews.Google Scholar
127 David M. Lampton and David S. G. Goodman have both attested to the continuing presence of small-scale vendors and hawkers on the streets in urban areas today. Goodman relates that different vendors within the same city charge different prices for the same product.
128 Weiss states that by 1959 private pedlars and traders handled only 2 percent of the total retail sales in China. Weiss, , op. cit., p. 19.Google Scholar
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† HHYP, 3, No. 2 (1950), p. 346.Google Scholar
• HHJP, 10 November, 1951, p. 2.Google Scholar
