Historically, the Chinese economy was characterized by widespread poverty, extreme income inequalities, and endemic insecurity of livelihood.
Until the end of the 1970s, the fruits of economic growth were largely negated by population increases, which prevented significant advances in the per capita availability of food, clothing, and housing beyond levels achieved in the 1950s.
[1] In 1978, the Chinese Communist Party, under the leadership of Deng Xiaoping, began to introduce market reforms, including decollectivizing agriculture, allowing foreign investment and individual entrepreneurship.
[3] After thirty years of austerity and marginal sufficiency, Chinese consumers suddenly were able to buy more than enough to eat from a growing variety of food items.
[1] Stylish clothing, modern furniture, and a wide array of electrical appliances also became part of the normal expectations of ordinary Chinese families.
The improvements in the standard of living were demonstrated by a boom in rural and urban housing, together with a considerable increase in the ownership of televisions and other appliances.
[1] Consumers also tripled their purchases of woolen fabrics in these years and bought growing numbers of garments made of silk, leather, or down.
[1] In 1987 Chinese department stores and street markets carried clothing in a large variety of styles, colors, quality, and prices.
[1] Many people displayed their new affluence with relatively expensive and stylish clothes, while those with more modest tastes or meager incomes still could adequately outfit themselves at very low cost.
[1] Simple, inexpensive household items, like thermoses, cooking pans, and clocks were stocked in department stores and other retail outlets all over China from the 1950s on.
[1] In the 1960s production and sales of bicycles, sewing machines, wristwatches, and transistor radios grew to the point that these items became common household possessions, followed in the late 1970s by television sets and cameras.
[1] Household survey data indicated that by 1985 most urban families owned two bicycles, at least one sofa, a writing desk, a wardrobe, a sewing machine, an electric fan, a radio, and a television.
[1] With the introduction of the responsibility system and the more than doubling of rural incomes in the early 1980s, another wave of housing construction took place as farm families moved quickly to invest in their major personal assets – their homes – which for the most part were privately owned.
[1] In the Yangtze River Valley and in south China, some fishing and boat transportation communities continued to live on their vessels.
[7] The 27 percent of the urban labor force that was employed in collectively owned enterprises earned less on average than workers in state-owned units.
[1] In the more open commercial environment of the 1980s, a small but significant number of people earned incomes much larger than those in regular state-owned and collectively owned units.
[1] Private, part-time schools, which appeared in large numbers in the mid-1980s, offered moonlighting work to university professors, who could double or triple their modest incomes if they were from prestigious institutions and taught desirable subjects, such as English, Japanese, or electronics.
[1] Business people who served as a liaison between foreign firms and the domestic economy could earn incomes many times higher than those of the best-paid employees of state-owned units.
[1] In the late 1970s and early 1980s, when these businessmen were politically rehabilitated, their incomes were returned with the accrued interest, and some suddenly found themselves quite wealthy.
[1] Although the number of people earning incomes far beyond the normal wage scale was tiny relative to the population, they were important symbols of the rewards of economic reform and received a great deal of media attention.
[1] In China, as in other countries, an important determinant of the affluence of a household was the dependency ratio – the number of nonworkers supported by each worker.
[1] There was great variation in rural income levels among different provincial-level units, counties, towns, villages, and individual families.
[1] Soil type and quality, rainfall, temperature range, drainage, and availability of water determined the kinds and quantities of crops that could be grown.
[1] The highest agricultural incomes were earned by suburban units that were able to sell produce and sideline products in the nearby cities.
[1] Township enterprises were considered by the government to be the main source of employment for rural workers who were leaving agriculture because of rising productivity under the responsibility system.