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By Neville Maxwell

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Extra resources for China's Road to Development

Sample text

Such relationships became an important part of conflict in local politics and often were linked to factions at the national level through the Communist Party. Administration by model, when combined with the investment criteria contained in the policy of despecialization, limited the role of "profit" largely to the measurement of efficiency within enterprises. It eliminated the profit criteria as a source of reward for management in the form of bonuses and as the major criteria for new state investment to provide for the growth of an enterprise.

Despecialization and self-reliance aimed to mobilize marginal undeveloped sources of raw materials and human talent and develop all aspects of producer and consumer goods industry in poor and technologically undeveloped areas. It based investment decisions on a concept of "rationality" that went beyond nationally or centrally calculated concepts of cost efficiency and profit, thus opening up locations and opportunities for industrialization that would not be considered otherwise. The purpose of despecialization was to enhance the capacity of local authorities to meet local needs and raise local income and living standards without undermining the local authorities' commitment to contribute to national construction.

Thence it is argued that Mao cared less about modernization and industrialization than for abstract revolutionary principle. Such views are based on a fundamental misunderstanding. The word for incentive in Chinese has the connotation of inciting or provoking action. It further implies that "incentive" acts on a pre-existing and underlying morality that is part of an individual's character. The "incentive" is simply a stimulus, triggering action to which a person is already predisposed. , those whose ethics reject the principle of self aggrandizement For workers, incentives based on the morality of self aggrandizement meant that they could not participate for long or very meaningfully in management.

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