Socialist Welfare in a Market Economy: Social Security Reforms in Guangzhou, China

China has pursued an open-door policy since 1978, but despite the gradual adoption of a market economy the country still retains two essential features of socialism - an economy dominated by state-owned enterprises and an all embracing social security system which protects the majority of Chinese workers. In view of these facts, this volume examines three important questions:- Can socialist social welfare co-exist with the market economy?- Can state-owned enterprises survive in a market economy?- Has China succeeded in creating a market economy without sacrificing its socialist ideals?The authors explore these issues through the experience of Guangzhou, the most populous city in Southern China and one of the first major cities in the country to convert to a market economy. The revealing study demonstrates that compromises have been necessary to accommodate both socialist and market objectives. Continuing to support urban workers with the social security benefits has, for example, made enterprises less competitive and disparities in benefits arise as workers are allowed to supplement the minimum guaranteed income through savings in individual accounts. The key conclusion is that the social security system in China is now neither socialist nor capitalist, but is simply changing to meet the income security needs of workers who are struggling hard to adapt to the market economy.