Question

The contemporary Chinese economic system is arguably a mixture of the elements of both market and plan. At the same time, the macroeconomic performance of the Chinese economy during the past decade has exhibited many characteristics of a market economy, specifically cyclical fluctuations. To what extent and in what ways can the counter-cyclical policies of a market system be effective in the mixed Chinese economy?

Answer 1

Given the performace of chinese economy , it is expected to cool down with counter cyclical policies.China has been the fatest growing economy and effectiveness of the counter cyclical depends on different scenarios such debt-investment , financial scrutiny , social factors , factory pollution etc. Such factors need to be taken care of, with focus on different baking instrument and variables of the economy .The boom and recession can be cooled or stimulated respectively by different interactions between agents and instruments of the economy .