The report of the 19th National Congress of the Communist Party of China clearly put forward: implementing the new development concept and building a modern economic system. The core of building a modern economic system is to promote high-quality development, which mainly includes two aspects: first, on the basis of quality change, efficiency change, power change and improving total factor productivity, to build an industrial system with coordinated development of real economy, scientific and technological innovation, modern finance and human resources; Second, on the basis of adhering to the direction of socialist market economy reform, build an economic system with effective market mechanism, dynamic micro-subjects and moderate macro-control. To promote these two aspects of construction, we need to take supply-side structural reform as the main line.
It is objectively inevitable to take the supply-side structural reform as the main line.
Since the 18th National Congress of the Communist Party of China, Socialism with Chinese characteristics has entered a new era, and the cause of the party and the state has achieved all-round and groundbreaking achievements, and profound and fundamental changes have taken place. An important manifestation of the historic changes in the cause of the party and the state is that the main social contradictions have been transformed into contradictions between the people’s growing needs for a better life and the unbalanced development. The change of the main contradiction in our society fundamentally determines that we must build a modern economic system with the supply-side structural reform as the main line.
The basic movement mode of social principal contradiction has not changed, which determines that development is still the basis and key to solve all problems. In the new era, the main social contradiction in our country has changed, but its basic movement mode has not changed, and it is still the contradiction between "development" and "need", and the solution is still to meet "need" through "development". Therefore, although the main social contradictions have changed, "our judgment on the historical stage of socialism in China has not changed, the basic national conditions that China is still in the primary stage of socialism for a long time have not changed, and China’s international status as the largest developing country in the world has not changed." This means that development is still the basis and key to solve all problems and the top priority of the party in governing and rejuvenating the country. The fundamental purpose of supply-side structural reform is to improve the level of social productivity and better meet the people’s growing needs for a better life. It makes the supply system adapt to the change of demand structure effectively, so that "development" and "need" are interconnected and matched effectively. Therefore, in the new era, the development, especially the liberation and development of social productive forces as the basis of social development, needs to exert strength from the supply side and deepen the structural reform of the supply side.
The connotation of major social contradictions has undergone profound changes, which requires great efforts to solve the supply-side problem in development. Entering the new era, the two ends of the main contradiction movement in our society — — The connotations of "need" and "development" themselves have undergone profound historical changes, which have led to profound changes in the connotation of major social contradictory movements, from the contradiction between people’s growing material and cultural needs and backward social production to the contradiction between people’s growing need for a better life and unbalanced development. At present, the main factor that restricts the people’s growing need for a better life is the insufficient imbalance of development. The root of this imbalance lies in the insufficient quality and efficiency of supply, structure and level, and innovation ability, which is manifested in the fact that the level of the real economy needs to be improved, the ecological environment protection has a long way to go, there are still many shortcomings in the people’s livelihood, the task of tackling poverty is arduous, and the gap between urban and rural regional development and income distribution is still large. These outstanding problems are essentially problems on the supply side of the national economy. The fundamental reason is that the productive forces are not developed enough, and the root cause is a major structural imbalance. The supply-side structural reform focuses on solving structural problems, and the main direction is to improve the quality of supply. The fundamental starting point is to make China’s supply capacity better meet the people’s growing, upgrading and personalized needs for a better life, thus achieving the goal of socialist production. Only by building a modern economic system with supply-side structural reform as the main line,Only in this way can we solve the major structural imbalance and lay a solid material foundation for completely solving the problem of insufficient development imbalance and meeting the people’s growing needs for a better life.
To effectively resolve the risks in the current economic operation, we need to take the supply-side structural reform as the main line. Modern economic system must be an economic system that can effectively cope with risks. At present, the "double risks" of China’s economy coexist, including the potential inflationary pressure driven by cost and the downside risk caused by weak demand, and the reasons are mainly concentrated on the supply side. For example, the main reason for the potential inflationary pressure is the rising factor cost on the supply side; The deep-seated reason for the slowdown in investment demand growth is that the supply-side innovation ability is insufficient and it is difficult to find effective investment opportunities; The main reasons why consumption is restrained to some extent are effective and insufficient supply in the middle and high end. Therefore, to overcome the new imbalance of "double risks", we need to build a modern economic system with supply-side structural reform as the main line.
The supply-side structural reform has grasped the key to building a coordinated industrial system.
The industrial system of coordinated development of real economy, scientific and technological innovation, modern finance and human resources is an important part of modern economic system. The supply-side structural reform has grasped the key to building a coordinated industrial system.
Comprehensively improve the level of the real economy, especially the manufacturing industry. The report of the 19th National Congress of the Communist Party of China pointed out: "To build a modern economic system, we must focus on the real economy and improve the quality of the supply system as the main direction, so as to significantly enhance China’s economic quality advantage." No matter when the economy develops, the real economy is the foundation for China’s economic development and winning the initiative in international economic competition. Developing the real economy is the core and key to build an industrial system with the coordinated development of the real economy, scientific and technological innovation, modern finance and human resources. The main task of supply-side structural reform is to revitalize the real economy. Unlike demand-side management, which focuses on the demand side and consumers, supply-side structural reform focuses on the supply side and producers. This mainly includes three categories: first, as the first factor of production, the supply-side structural reform should focus on improving labor productivity and building a knowledge-based, skilled and innovative workforce; Second, enterprises combined with means of production, supply-side structural reform focuses on improving the competitiveness of enterprises, cultivating world-class enterprises with global competitiveness, stimulating and protecting entrepreneurship, and encouraging more social subjects to participate in innovation and entrepreneurship; The third is the collection of enterprises and enterprises — — Industrial and supply-side structural reform should improve industrial organization, optimize industrial structure, cultivate new growth points, form new kinetic energy, support the optimization and upgrading of traditional industries, and cultivate world-class advanced manufacturing clusters. These measures will certainly stimulate economic vitality and accelerate the transformation of growth momentum.Comprehensively improve the level of the real economy, especially the manufacturing industry.
Comprehensively optimize industrial structure and improve industrial quality. Optimizing industrial structure and improving industrial quality is the proper meaning of building an industrial system with coordinated development of real economy, scientific and technological innovation, modern finance and human resources. Supply-side structural reform focuses on guiding demand development with new supply, and promoting industrial structure optimization and industrial quality improvement from three levels. First, optimize the allocation and combination of production factors such as science and technology, capital and labor, improve the utilization level of production factors, promote the improvement of total factor productivity, and continuously enhance the endogenous growth momentum of the economy; The second is to optimize the existing supply structure, by adjusting the existing product supply structure and improving the quality of products and services, to solve the problem of dislocation between supply and demand from a deep level; The third is to promote industrial optimization and restructuring, vigorously develop new industries and new formats, vigorously develop strategic emerging industries and modern service industries, and provide new products and services. The supply-side structural reform starts from the production side, and on the basis of improving the efficiency of factor allocation, total factor productivity, labor productivity and enterprise competitiveness, it promotes the optimization and upgrading of industrial structure, comprehensively improves industrial quality and quality, fosters new impetus and creates a new engine for sustained economic growth, and meets the requirements of building an industrial system with coordinated development of real economy, scientific and technological innovation, modern finance and human resources.
Supply-side structural reform is conducive to the realization of effective market mechanism, dynamic micro-subjects and appropriate macro-control.
An economic system with effective market mechanism, dynamic micro-subjects and moderate macro-control is another important part of the modern economic system, and its core lies in realizing the organic unity of the three. Only when the three are organically unified can we break all kinds of constraints on the development of social productive forces to the maximum extent and liberate and develop social productive forces; In order to avoid economic ups and downs and maintain sustained and healthy economic development; Only in this way can we stimulate the creativity and development vitality of the whole society and achieve higher quality, more efficient, fairer and more sustainable development. The essential attribute of supply-side structural reform is deepening reform, which requires accelerating the improvement of the socialist market economic system, promoting the reform of state-owned enterprises, accelerating the transformation of government functions, and deepening basic reforms in the fields of price, finance, taxation, finance, and social security. Only by building a modern economic system with supply-side structural reform as the main line can we successfully build an economic system with effective market mechanism, dynamic micro-subjects and moderate macro-control.
Is conducive to the realization of effective market mechanism. Making the market play a decisive role in resource allocation and giving better play to the role of the government is a major principle to promote the structural reform of the supply side. Supply-side structural reform does not stop at total intervention like demand management, but deeply affects producers and economic structure, so it puts forward higher requirements for handling the relationship between government and market and improving the socialist market economic system. Building a modern economic system with supply-side structural reform as the main line requires not only following market rules and making good use of market mechanisms to solve problems, but also letting the government shoulder the responsibility and do its own thing well. Therefore, we should persist in making the market play a decisive role in the allocation of resources, improve the market mechanism, break the monopoly of industries and local protection, enhance the ability of enterprises to respond and adjust to changes in market demand, and improve the efficiency and competitiveness of enterprise resource allocation. It is necessary to give full play to the role of the government, stimulate market vitality with reform, guide market expectations with policies, clarify investment direction with planning, and regulate market behavior with the rule of law on the basis of respecting market laws.
It is beneficial to improve the vitality of micro-subjects. Building a modern economic system with supply-side structural reform as the main line requires deepening the reform of property rights system and factor marketization. The purpose of deepening the reform of property rights system is to make all kinds of ownership economies and various types of property rights clearly defined, strictly protected and smoothly circulated, so as to ensure a good market order, stimulate the vitality of market players and stabilize market expectations. At this stage, it is particularly necessary to deepen the reform of state-owned enterprises, develop a mixed-ownership economy and cultivate world-class enterprises with global competitiveness; At the same time, support the development of private enterprises and stimulate the vitality of various market players. The purpose of deepening the reform of factor marketization is to implement the principle of equivalent exchange and improve the fairness and authenticity of market competition. At this stage, it is particularly necessary to fully implement the negative list system of market access and clean up and abolish various regulations and practices that hinder unified market and fair competition, especially to break administrative monopoly and prevent market monopoly; At the same time, improve the market supervision mechanism and give full play to the role of the market in determining prices. Through these two major reforms, effective incentives for property rights, free flow of factors, flexible price response, fair and orderly competition, and the survival of the fittest will be realized, effectively improving the vitality of micro-subjects.
Conducive to the realization of macro-control. Building a modern economic system with supply-side structural reform as the main line requires changing macro-control methods, unifying aggregate demand control with deepening supply-side structural reform, unifying short-term control with long-term control, aggregate demand control with structural control, creating a favorable environment for stable economic growth with moderate aggregate demand management, and promoting the effective solution of the deep contradiction of aggregate imbalance with supply-side structural reform. At present, we should vigorously innovate and improve macro-control, give play to the strategic guiding role of national development planning, and improve the coordination mechanism of financial, monetary, industrial and regional economic policies; Deepen the reform of investment and financing system, deepen the reform of financial system, improve the dual-pillar regulatory framework of monetary policy and macro-prudential policy, improve the financial supervision system, and continuously improve the scientificity, predictability and effectiveness of macro-control.
(The author is Liu Wei, President of China Renmin University)