Social Sciences in China, 2022

Vol. 43, No. 1, 2022

Creating a New Chinese Discourse on Political Economy: The Innovative Development of China’s Private Sector Theory

Zhang Wanming and Liu Yingqiu

Abstract：Ever since China implemented its reform and opening up policy in the late 1970s, it has engaged in theoretical and practice-based innovations in the development of its private sector. China has experienced four evolutionary stages of private sector development and theoretical innovation: from proposing that the private sector was “subsidiary and complementary to the socialist public sector,” to elevating it to the heights of China’s “basic economic system”; from adhering to the principle of “the two unwaverings,” i.e., unwaveringly consolidating and developing the public sector on the one hand, and unwaveringly encouraging, supporting, and guiding the development of the non-public sector on the other; and thence to further stating explicitly that “private enterprises and private sector entrepreneurs are one of us; they are socialist.” New theories of private sector development have been created in response to the inherent requirements of the primary stage of socialism, to the choice of the correct path to common prosperity, and to the human behavioral rationality and the laws governing people’s interest claims. The private sector is an important achievement of the development of the socialist market economy; an important force promoting the development of the socialist market economy; and an important actor in the building of the modern economic system. Creating new theories of private sector development has opened up a new realm for Marxist political economy.

Keywords: private sector, economic system, socialist market economy, political economy