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It is not unusual for reforming socialist economies to relax wage controls without hardening budget constraints on enterprises or freeing consumer goods prices. This policy can be dangerously destabilizing. While higher wages permit workers to purchase more of some goods, they also tend to...
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rationing, we first check if the model stands up to China's data and, if so, we estimate its key structural parameters. Using … province-level panel data from 1949-1992, we find that the importance of peasants in China's governmental objective function is … accumulation. Such findings are consistent the reality in China. …
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