How accurate is it to say that Mao Zedong’s agricultural policies from 1949 were the most important reason for the famine of 1959–62?
In October 1949, the People’s Republic of China (PRC) was established and led by Mao Zedong. China’s new communist leaders turned their backs on China’s traditional output (based on individual and small scale household production) economy and set out to create a massive socialist industrial government inspired by the Soviet Union. This idea introduced a model, which prioritize industrialization known as the “Big Push Model”. China started prioritizing investments into the heavy industry, which would reshape the Chinese economy and create a Command economy. Mao’s economic policies seemed be working in the
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Most of China’s investments started to go towards the heavy industry. China had already started to put less priority on Agriculture because it was less profitable. The government controlled the economy directly and used this control to pump resources into the construction of new factories (new industries: electric generating equipment, chemical fertilizer, motor vehicles). Heavy industrial sectors supplied each other’s demands, based on the government’s investment decisions. (Limited spillovers to market development) Industrial output started to grow rapidly while agriculture output declined (Agriculture share declined from 51% to 21%) The government also had procurement for grain. The government owned most factories and controlled agriculture enabling them to control price systems and set up relative prices to channel resources into government hands and into big push industrialization; Factory products and industrialization was expensive but farm and agricultural products were cheap. The socialist state intentionally assigned prices to the products of industry that were high (for their own profit) and assigned low prices to products of agriculture; because of this agriculture because a low return and manufacturing was more profitable. Farmers started to want to abandon agriculture in order to get better opportunities in the city. This led to strict restrictions on mobility, and the formation of