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Surmounting Uncertainties to Ensure Health, Growth and Common Prosperity

Jan 25-2022   



To achieve common prosperity, a multi-pronged mechanism must be put to full use, with a particular focus on leveraging the first income distribution, said Prof. Liu Guo’en of the NSD in a speech. He also analyzed the covid-19 pandemic and China’s economic growth.

 

Compared to the second and the third income distribution, the first distribution rewards people based on their work, thereby ensuring a fairer income distribution and conferring dignity and value on laborers, said Prof. Liu, who is PKU Bo Ya Distinguished Professor and a member of the national covid-19 expert group. Of the improvements that still could be made to the labor market, the residence permit system needed to undergo further reforms to enhance both economic efficiency and social equity. Another measure to facilitate common prosperity would be to include senior high school in the compulsory education, thus enabling more youths in the countryside to acquire knowledge and skills that were indispensable in today’s information society, he said. A survey by Peking University showed that in 2020 over 30% of China’s working-age population didn’t have senior high education.

 

With regard to the covid-19 pandemic, Prof. Liu commended China’s achievement through clearly defined policy guidelines and strenuous efforts nationwide. Even so, the Chinese economy might be confronted with bigger uncertainties and complexities in 2022. For one, Omicron had a higher infectious rate among young people, which might result in a heavier burden on families and societies. The silver lining could be that Omicron might evolve into a seasonal epidemic, allowing governments across the world to optimize control and quarantine measures. For the other, economic expansion would inevitably lead to a declining growth rate. Therefore, China had to improve its marginal productivity through technological and institutional innovations. That its all-factor productivity still lagged behind that of developed economies was not merely a cause for handwringing but also a source for unleashing potential.

Surmounting Uncertainties to Ensure Health, Growth and Common Prosperity

Jan 25-2022   



To achieve common prosperity, a multi-pronged mechanism must be put to full use, with a particular focus on leveraging the first income distribution, said Prof. Liu Guo’en of the NSD in a speech. He also analyzed the covid-19 pandemic and China’s economic growth.

 

Compared to the second and the third income distribution, the first distribution rewards people based on their work, thereby ensuring a fairer income distribution and conferring dignity and value on laborers, said Prof. Liu, who is PKU Bo Ya Distinguished Professor and a member of the national covid-19 expert group. Of the improvements that still could be made to the labor market, the residence permit system needed to undergo further reforms to enhance both economic efficiency and social equity. Another measure to facilitate common prosperity would be to include senior high school in the compulsory education, thus enabling more youths in the countryside to acquire knowledge and skills that were indispensable in today’s information society, he said. A survey by Peking University showed that in 2020 over 30% of China’s working-age population didn’t have senior high education.

 

With regard to the covid-19 pandemic, Prof. Liu commended China’s achievement through clearly defined policy guidelines and strenuous efforts nationwide. Even so, the Chinese economy might be confronted with bigger uncertainties and complexities in 2022. For one, Omicron had a higher infectious rate among young people, which might result in a heavier burden on families and societies. The silver lining could be that Omicron might evolve into a seasonal epidemic, allowing governments across the world to optimize control and quarantine measures. For the other, economic expansion would inevitably lead to a declining growth rate. Therefore, China had to improve its marginal productivity through technological and institutional innovations. That its all-factor productivity still lagged behind that of developed economies was not merely a cause for handwringing but also a source for unleashing potential.