In 1978, China formally recognized the deficiencies of Soviet-style planning and adopted a policy to reform its economy (Chow). Through its financial reform, China has embraced a market-based financial system by establishing financial institutions and markets (Ito). The financial reform has aimed to develop the economy by acquiring funds necessary for investment, while simultaneously improving the efficiency of investments by allocating capital effectively (Gen-you). By establishing a central bank, developing a financial market system, and opening the financial market to the global community, China’s financial reform has played an important role in the country’s economic growth.
The establishment of the People’s Bank of China as the central bank has allowed China to conduct effective monetary policy. In the first half of the 1990’s, the Chinese economy experienced impressive growth, averaging a 12 percent growth rate over the five-year period. However, this success......

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Title: Chinese Economic Reform
Approximate Word Count: 783
Approximate Pages: 4 (250 words per double-spaced page)

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