Photographed by Zhu Gaolei

Zhang Zhuoyuan receiving Wu Yuzhang Award from Vice Premier Ma Kai. The award ceremony of the Wu Yuzhang Humanities and Social Science Award was held in Beijing on December 17, 2013.

Described by his contemporaries as an “evergreen tree in the field of economics”, Zhang Zhuoyuan is the recipient of the 2013 Wu Yuzhang Lifetime Achievement Award. A challenger to traditional thinking, Zhang made substantial contributions to the current thinking on the Chinese economy by employing principles of the socialist market economy in price reform, macroeconomic regulation and state-owned enterprise (SOE) reform. Famed for taking a “prudent” position, Zhang has participated in the drafting of many policy papers. He accepted an exclusive interview from WAN’s Deng Zhimei after the award ceremony.

WAN: In your 60 years of economics research, which of your contributions do you believe is the most valuable?

Zhang: From my point of view, it should be the concept of “prudent reform”. During the process of China’s reform and opening up, the fundamental principle we followed was “prudent development”. This is the key for any economic development. China was developing from very weak base when it began its reforms, so trying to accomplish everything in one step—“shock therapy”—would have been incredibly risky, while the “prudent policy” approach was able to ensure efficiency in the reform process. This also applies to economic development—solely pursuing double-digit growth rates will have negative side-effects. We can’t neglect the lessons learned from this in the past.

WAN: Your track record of raising new ideas, both in theories and policy, goes back to the 1960s, a time when you doubtlessly faced huge pressures and were sometimes even criticized and ostracized for your views. Nevertheless, you have always encouraged younger economists to challenge existing theories and look for new solutions. Where did you find the courage to stick so boldly to your beliefs?

Zhang: To a great extent, I was influenced by my supervisor Sun Yefang (1908-1983, a landmark economist in China), who would never give up if he thought he was right. Before the “Cultural Revolution”, Sun insisted on writing proposals for reform to the Chinese government in spite of the punitive pressures he would have faced. Deeply impressed by his education, I believed that it is a scholar’s principle and responsibility to follow truth. Therefore, although the relevant agencies had already defined the idea of the “prices of production” as “revisionist” (at that time), I co-authored “Analyzing Prices of Production in Socialist Economy” with He Jianzhang. I used a pen-name, however.
 

WAN: You participated in drafting the “CPC Central Committee Resolution Concerning Comprehensively Deepening Reforms” released at the conclusion of the Third Plenary Session of 18th CPC Central Committee. The Resolution’s statement “to have the market play a critical role” sparked great resonance. What direction do you believe the reforms will head?

Zhang: In order to have the market play a critical role in resource allocation, the most important move is to transform government functions. Currently, the Chinese government intervenes economy too much at micro-levels, but does not provide enough public services and social supervision. Only by establishing a unified, open, fair and competitive system, and a system where prices, as a major indicator of resource allocation, do not become artificial, can the market play its proper role in optimally allocating resources. Outside of this, we need to encourage the creativity and productivity achieved by more privatized economies.

WAN: Having studied the Chinese economy diligently for close to six decades, how far would you say we are from establishing a Chinese socialist economics?

Zhang: We are still in the process of practice. Our theories, even if they are valid when we propose them, need to be verified by practice.  Once China fulfills its dream of rejuvenation, we can form the framework for Chinese socialist economics.

WAN: You were just honored by the Wu Yuzhang Lifetime Achievement Award. What topics do you plan for study in the future?

Zhang: At my age, embarking on a long-term project is difficult. I will continue monitoring economic policy as well as economic reform. I have worked for Economic Research Journal since 1955, so I have some knowledge about the general debates within Chinese economics circles and the history of Chinese economics over the past few decades. Hopefully, I can use it, if it may be called my strength. So, other than continuing to edit the two “collections” Sixty Years of Studies on Economics in China and Historical Perspectives on Chinese Economics, I will concentrate on combing through China’s economic history.

The Wu Yuzhang Humanities and Social Science Award is named after the first president of Renmin University, who was an outstanding revolutionary, educator, historian and linguist. The award recognizes distinguished scholars in the humanities and social sciences.

 Translated by Feng Daimei

Revised by Charles Horne

The Chinese version appeared in the Chinese Social Sciences Today, No. 546, January 8, 2014

Chinese link: http://www.csstoday.net/xueshuzixun/guoneixinwen/87111.html