Author: Tian Xiaozhong (Associate Professor at the Institute of Chinese Economic History, Yunnan University)
There are riches in history. “Two Thousand Years of Market China” written by economic historian Professor Long Denggao is a new historical work that explores the history of traditional Chinese economic development, gains new knowledge, and enlightens wisdom.
The book consists of four parts and 17 chapters, with nearly 400,000 words in length, making a comprehensive, systematic and in-depth exploration of the history of the origin, growth and maturity of the Chinese market from multiple aspects and angles. The book believes that China’s traditional market was built on the disintegration of the well-field system. After its initial rise during the Warring States, Qin and Han Dynasties, it declined after its heyday in the Western Han Dynasty. It developed tortuously during the Wei, Jin, Southern and Northern Dynasties, Sui and Tang Dynasties, flourished again during the Five Dynasties, Song Dynasty, Jin and Yuan Dynasties, and matured during the Ming and Qing Dynasties. , and ultimately form a unified national market.
The book has a broad vision and detailed content. It provides a detailed and theoretical analysis of the historical facts of the development and evolution of China’s traditional market. It is full of original ideas and not only demonstrates important academic value, but also has enlightening significance for reality.
Along the River During Qingming Festival (Part)
In the author’s writing, the market “shows both trading behavior and a place of exchange” and “not only reflects the various relationships of exchange between people, but also is an economic mechanism.” The genes of the market are deeply embedded in Chinese history.
The book quotes the words from “Selected Works of Marx and Engels” and points out that all civilized nations entered history with communes or with their very significant remnants. China is naturally no exception. At the end of primitive society, the emergence of exchange already meant the beginning of the market. The true origin of the market will have to wait until the well-field system prevalent in slave societies collapsed.
At that time, rural communes collapsed, and individual small families separated from the communes and became independent production units. Families that became independent from the communes obtained land ownership and independent production rights. However, due to the small scale of production, individual households can only rely on exchange when facing natural and other risks, and in order to obtain labor tools that they cannot produce. They sell the agricultural and sideline products they produce in exchange for needed production materials and daily necessities, thereby carrying out economic production and reproduction to meet family continuation and living needs.
This need for exchange, as well as the market for meeting production and living needs through exchange, has always existed in traditional Chinese society. The market composed of individual small family transactions as the main body is the most basic form of China’s traditional market. Its growth and development have deep roots and determine the development level and development space of China’s traditional market.
The process of individual families becoming independent from the well-field rural commune is also a process of expansion and development of social division of labor. With the improvement of social productivity and the increase of products, exchanges have become more frequent. As a result, businessmen who were independent from individual small families and specialized in exchange emerged. Merchants turned specialties from different families and different regions into commodities for transshipment and sale, chasing the price difference between them, and engaging in cyclical exchanges with the purpose of obtaining profits, and commercial activities developed. With the expansion of the market and the development of commercial activities, “currency” as a lubricant for commodity exchange has also developed and circulated.
The market expanded, bringing more households and wider areas into the exchange system. In order to meet the needs of production and life, people continue to put their products into the market, becoming both continuous suppliers of goods in the market and consumers. When exchange develops to a certain stage, land and labor also become commodities, forming a land market and a labor employment market. The expansion of commercial activities and markets promoted the development of trading centers, and the urban economy prospered accordingly, forming a certain connection with the rural market.
After the emergence of the “market”, looking at the history of China’s economic development, the market form with individual small families as the main body of exchange has lasted for thousands of years. During the Warring States, Qin and Han Dynasties, commercial activities with individual small families as the main body of exchange and merchants as the medium promoted the emergence, development and expansion of the traditional market. From the Tang and Song Dynasties to the Ming and Qing Dynasties, market development was also based on the improvement of the production capacity of individual small families and the expansion of division of labor. After the dismantling of the land equalization system in the Tang Dynasty, household productivity increased, and specialized production in agriculture and handicrafts further increased the supply of commodities. The sudden rise of tea brought new changes to the commodity market in the Tang and Song Dynasties. The scale of commercial activities expanded, and the means of exchange and currency supply also developed new developments. Rural grass markets and town markets have emerged and are increasingly connected with urban markets. On the basis of the development of transportation conditions, long-distance trade of bulk commodities has made great progress, and the degree of market integration has increased accordingly. Market integration is conducive to further promoting the flow and allocation of resources, thereby integrating the production and processing of different individual households, different regions and industries into the market system, and the connection between individual households and the market is therefore closer. During the Ming and Qing Dynasties, industry and regional division of labor brought about the expansion of commodity supply, the formation of regional business gangs, the development of merchant capital, sufficient supply of silver currency, and improvement of transportation conditions. On the basis of the Song and Yuan markets, cross-regional trade finally A unified market across the country was formed. The formation of a unified national market provides a new stage for social and economic development.
Tang Kaiyuan Tongbao
Market development through the ages
After outlining the overall process of China’s market development, the author made a detailed review of the market development of major dynasties, which I briefly introduce here.
Warring States, Qin and Han Dynasties – the market first emerged. The Warring States, Qin and Han Dynasties were the initial stage of the development of the traditional market. The most prominent manifestation was the expansion of division of labor and exchange. The number of commodities circulating in the market began to increase. Luxury goods accounted for a considerable proportion of the circulation, but people’s livelihood necessities had widely entered the market. During this period, the market for grain and agricultural and sideline products was still in a sluggish state, with limited quantities. The trading of salt and iron was already relatively active, land trading was prevalent, and the market was greatly developed. In the Qin Dynasty, different currencies popular in various places, such as cloth coins, knife coins, ant nose coins, etc., were unified into “half liang coins”, and metal coins circulated in the market. The rise of professional businessmen promoted the development of commerce and deepened market connections. With large cities such as Luoyang, Linzi, Shujun, and Chang’an as hubs, urban economic centers of a certain scale have been formed across the country, and markets have initially formed to connect market connections and commodity networks in various places.
Eastern Han Dynasty – the market declined. During the Eastern Han Dynasty, the power of powerful landlords grew, and the economy of individual small farmer families gradually declined. This also caused the decline of the market, the number of professional businessmen decreased, and the “powerful merchants” who relied on their privileges to carry out profit-making activities in the market became prominent. In the composition of market commodities, the proportion of luxury goods has increased, the market for people’s livelihood necessities has decreased, the means of circulation have also regressed, and the urban market has been depressed.
Wei, Jin, Southern and Northern Dynasties – the market was sluggish. During this period, land was concentratedly occupied by wealthy clans, and land rights were highly concentrated. The manorial economy has developed significantly, but the characteristics of commercial self-sufficiency are obvious. In the Wei, Jin, Southern and Northern Dynasties, most people engaged in business were aristocrats and bureaucrats. Peasants and individual craftsmen have long been attached to wealthy clans and are basically insulated from the market. The commodity trading market has been in a state of sluggishness for a long time.
Sui and Tang Dynasties – market resurgence. Before the Tang Dynasty, Emperor Xiaowen of the Northern Wei Dynasty implemented a land equalization system in the northern region in order to restore agricultural production, allocating land and collecting taxes based on population. This system promoted agricultural development, but tied labor to the land and affected commercial development. During the Mid-Tang Dynasty, after the land equalization system was replaced by the Two Taxes Law, a free land market was realized again, and people were once again liberated from the land. Rural markets developed, grass markets grew, more agricultural products entered circulation than during the Warring States, Qin and Han Dynasties, and the number of people’s livelihood necessities increased. In the late Tang Dynasty, commercial grain developed to some extent, but it was mainly limited to regulating harvests and failures between regions through the market. It was also during this period that the tea market suddenly emerged. Professional businessmen represented by traffickers grew and became increasingly active in the market. In the city, the city-market system was implemented in the early stage. In the later period, markets began to be built and expanded. The city walls were broken down, and the “city” was expanded and began to expand to the suburbs. In terms of currency circulation, in the early stage, “money and silk were both used”. In the middle and later stages, with the expansion of the market, the phenomenon of “money shortage” appeared. Folks responded to the money shortage by “eliminating foreign exchanges” and reduced the actual amount of copper coins paid in transactions. At this time, transactions using “convenient money” and “flying money” as credit appeared, which can be said to be the forerunner of the development of “credit”.
The Five Dynasties, Two Songs, Jin and Yuan Dynasties – flourished again. During this period, the commercial production of agricultural products expanded, and more and more products were converted into commodities and entered the circulation link, and even long-distance trade was realized. At this time, the commercial grain market broke through the regional adjustment pattern of abundance and shortage, and continued to develop between some stable commodity grain supply areas and consumer markets. Across the country, grass markets, markets, market towns and other towns have sprung up. The urban area of the city expanded, and market transactions penetrated into every corner within the city walls, forming some new lively streets. Near the city, grass markets developed and were incorporated into the city’s organizational structure. “Carvings and carriages compete on Tianjie, and BMWs compete on imperial roads.” Meng Yuanlao’s description in the preface of “Tokyo Menghua Lu” fully demonstrates the prosperity of Bianjing in the Northern Song Dynasty. Outside Bianjing, a Fuzhou market system developed with Fuzhou cities as the center, counties and towns as secondary centers, and villages and cities as the basic markets. During the Song and Yuan Dynasties, a wing-shaped regional market system in Zhejiang and Zhejiang was formed with Hangzhou as the center and Suzhou and Yuezhou as the north and south wings. Nourished by developed markets, opera became popular and the entertainment market began to develop. In the financial market, “money and money are used together”, credit currencies and banknotes such as Jiaozi, Huizi, Jiaochao and Baochao began to be used. Gold and silver gradually transformed into currency forms, and the sources of capital funds for merchants became increasingly diversified. Commodity trading at this time was concentrated on luxury goods and supplies specialized in overseas trade, while supplies for people’s livelihood were still relatively weak. It is worth noting that the classification of occupations dedicated to business is becoming increasingly refined. Wholesalers, brokers, and retailers each perform their own duties. Transaction methods such as credit sales and contract sales are gradually becoming more orderly. Logistics conditions such as transportation and warehousing facilities are also changing. has been improved.
Ming and Qing Dynasties – rapid development. During this period, land rights transactions and factor markets developed tremendously. It has become a continuous and common phenomenon to engage in business full-time, from traveling as a traveler, to doing business in overseas Chinese residences, and then to settle down in the country. It was also during this period that business gangs were formed in various places, and many guilds and trade offices were established to communicate and support businessmen. Among the business gangs in various places, Shanxi merchants and Hui merchants were particularly prosperous. Shanxi merchants pioneered the Wanli International Tea Road, pioneered China’s grain futures trade, and created the first ticket number, realizing a leap from commercial capital to financial capital. Moreover, Shanxi merchants often innovate in business management, and there are even personal stocks that use human capital to discount equity. In terms of currency circulation, silver became the main currency and copper coins were the secondary currency, supplemented by bills, forming a rich and diverse currency system. In terms of market categories, the Ming and Qing Dynasties formed a three-level market system: circulation hub cities, medium commercial towns, and rural markets. The circulation of goods, labor, capital, and information across the country increased significantly. A unified national market eventually form.
Pre-Qin sword coins
Strong market tradition
In the process of China’s reform and opening up, some people have always doubted the feasibility of China’s market economic path. One of the important understandings is the mistaken belief that China does not have the historical genes and traditions of a market economy, or that Chinese traditional culture excludes the market economy. The research in this book eloquently proves that China not only has a market development history of more than two thousand years, but also formed a unique development path under the evolution of the simple market, which has obvious characteristics compared with Western Europe at the same period.
For example, the author believes that the combination of land rights transactions and factor markets has promoted the development of traditional agriculture, but also inhibited its transformation into a modern economic form. Private ownership and free buying and selling of land have existed in traditional China since the collapse of the rural commune system under the well-field system. After the Tang and Song Dynasties, new land relations emerged such as pawns, permanent tenants, land rights, mortgages, and live sales. The emergence of these new land relations was based on the development of land property rights, market development levels, and improvements in transaction methods. . In ancient China, various property rights forms of land could exist independently at different levels and periods of time and enter the market for transactions, thus forming various property rights forms such as ownership, possession rights, use rights, etc., and their corresponding transaction forms. Each different level of land rights can be obtained through investment and transaction, and the property rights certificate and transaction certificate are expressed through contracts. Owner farmers, semi-owner farmers, and tenant farmers have established an individual family farm management system with their land ownership, possession rights, and use rights, and completed production and reproduction with the help of market factors and resource combinations. The interrelationship between the land rights market and individual family farms constitutes the fundamental characteristics and unique development path of China’s traditional economy. The combination of the two improves economic efficiency and land output, and drives the stable development of the traditional economy, especially the agricultural economy. However, the downside is that this system inhibits its transformation and reform into a modern economic form. This explains the difference in the evolution of economic forms between China and the West, and also explains why China’s traditional economy failed to move toward the industrial revolution explosively.
Tomorrow Shun four-year land lease Photo courtesy of Oriental Publishing House
Another example is that the author believes that China’s commodity market is developed, but the development of the labor market is relatively sluggish, and individual household operations have strong vitality and rationality. The book takes the textile industry in the south of the Yangtze River in the Ming and Qing Dynasties as an example, and analyzes the characteristics of this production system. The silk weaving industry at that time was mainly carried out through the connection of the commodity market, that is, through the method of contracting buyers to send materials and receive goods, division of labor and specialization were achieved. production, rather than directly organizing manual factory production. This characteristic is related to the relatively sluggish development of the labor market in the region and the developed commodity market. Since the Song Dynasty, China has formed a market system. Through a dense business network, scattered and small individual producers have been included in the market system, and through effective price transmission, the concentration and distribution of commodities in various places have been organized. Compared with investing a large amount of money to purchase labor, this system can make fuller use of the characteristics of China’s traditional economy.
The author points out in the book that in ancient China, strict control was mainly concentrated in the political field, while simple liberal policies were implemented on the private economy and market. The mainstream ideologies of rulers in the past dynasties mostly regard “hiding wealth from the people” as orthodox and “competing with the people for profits” as shame. In ancient China, there was never a lack of markets, nor was there a lack of development methods that used the market to promote division of labor, resource flows, and factor combinations. These insights all show the author’s excellent research vision.
The process of China’s reform and opening up is essentially the process of building a market economy. The great achievements made in more than 40 years of reform and opening up are the great achievements of the market economy.
Looking back at history, there have been several peaks in the development of the traditional Chinese market. These peaks stimulate the enthusiasm of producers, release social productivity, promote the flow and allocation of resources, and thus usher in economic and social development, stability and prosperity. In the development process of China’s traditional market, there has never been a lack of institutional innovation. From this point of view, the development of our market-oriented economy today has never been water without a source or a tree without roots, but has its roots. There are rich ores in history. From the historical origin and development evolution, we can better understand and grasp the market. As the author said in the preface, we must have full confidence in China’s market economic path.
The pictures in this article are all data pictures unless signed.
“Guangming Daily” (November 18, 2023, page 12)