Whether China meets all the requirements to call itself a third world country is an ongoing debate. However, in the 1950s China was one of the main exponents of what is called a state socialist economy. This particular condition basically meant a planned economy in the form of five-year plans taken over from the Soviet system starting in 1953. Targeted at the transformation into a productive, industrialized economy, the state developed a strict re-distributive system mainly serving the development of industry that simultaneously orchestrated the satisfaction of its citizens’ needs. As the architectural theorist Duanfang Lu claims, the bureaucratic clumsiness of such a scheme, limited access to resources, and goods in combination with a severe housing shortage forced inhabitants/dwellers of the work units to take different routes, also in regards to building and construction.

Specific counter-strategies were developed in order to bypass budgetary or distributive constraints and extensive waiting periods, especially within the social settings of work units, where social, cultural, and work life was organized under the umbrella of welfare to enforce productivity. Due to the tight social network between employees, their families, and those in charge, austerity and slow bureaucratic impediments created high pressure for the latter in work units, often resulting in alternative procurement strategies. “In 1956 alone, more than 400 work units built so-called ‘small structures’ (lingxing jianzhu) with floor space totaling 3.63 million square meters, of which only 64,000 square meters were in fact small structures – defined by the planning bureau as structures of less than 100 square meters (BDG 1957c). Still others applied for ‘quotas for small construction’ several times, and then pooled them together to build larger projects. (ibid).” (Lu, 2006:87)
In 1956, after an illegally erected child-care facility had been torn down by the planning bureau, angry women sent a letter saying: “the planning bureau has ulterior motivations: its plan is to plan people to death.” (Lu, 2006:89)

In addition to neglecting the official planning guidelines and specifications, work unit leaders responded to the general shortage of resources by ordering more building material than was actually needed, hoarding it, and subsequently establishing an informal exchange of goods among each other. “Hoarding behavior was a common feature of socialist enterprises […] a systemic flaw of the socialist system.” (Lu, 2006:93)

According to Mayfair, these emergences of counter-techniques are not simply to be assessed as a binary phenomenon involving an economic system and its shadow economy; rather it is “a tripartite scheme.” (Mayfair, 1989:27) Referring to the Chinese culture of gift exchange guangxi, the author describes a practice between corruption and a popular practice of “poaching on the territory of another mode of exchange, seeking the right occasions to strike and divert resources to its own method of circulation. In the process, it alters and weakens in a piecemeal fashion the structural principles and smooth operation of state power.” (ibid: 37)(CL)

Sources:
Lu, Duanfang (2006): Remaking Chinese Urban Form: Modernity, Scarcity and Space 1949 -2005. London: Routledge.
Mayfair, Mei Hui (1989): “The Gift Economy and State Power in China.” In:
Comparative Studies in Society and History, Issue 1/1989.,25-54
Cambridge University Press. http://www.jstor.org/stable/178793