How to Better Leverage the Leading Role of Economic System Reform: Pathways, Mechanisms, and Priority Areas

【Authors】

HU Jiayong

【WorkUnit】

Huaqiao University, 361021; Chinese Academy of Social Sciences, 100836.

【Abstract】

Throughout China’s reform process, economic system reform has consistently served as a pioneer, trailblazer, catalyst, and leader. The new elements and forces it has spawned, alongside the new contradictions, challenges, and opportunities it has engendered, have propelled and driven reforms in other domains, furnishing new drivers for economic development. 
The rural economic system reform broke the constraints of the traditional planned-economy system and marked the historic beginning of China’s reform and opening up. It established a new incentive mechanism that spurred the development of the rural market, promoted the growth of non-agricultural industries, and optimized the rural economic structure. Most importantly, rural reforms released a large pool of surplus agricultural labor, triggering a series of major institutional reforms—in grain circulation, land use rights transfer, household registration (hukou), social security, and rural governance—and cultivated the first generation of private entrepreneurs since the launch of reform and opening up.
The Third Plenary Session of the 18th Central Committee of the Communist Party of China set out on a new journey of comprehensively deepening reform, holistically advancing reform and systematically shaping a new institutional framework in the new era. Economic system reform occupies a pivotal position in this process, forming a clear pathway for comprehensive deepening reform characterized by spillover effects, cross-sector coordination and integration, and synergistic effects. In line with the principle of promoting both an efficient market and a well-functioning government, a series of interconnected, logically coherent reform measures has been introduced across the political, cultural, social, ecological, and national security spheres. In the political sphere, the Party’s centralized and unified leadership over economic work has been strengthened, government functions and institutional setups have been streamlined, and anti-corruption enforcement intensified. In the fields of culture, society, and ecological protection, market-oriented mechanisms have been introduced to reconfigure the division of labor among government, market, and social forces.
Fundamentally, the leading role of economic system reform is determined by the foundational status of the economy, as the economic base determines the superstructure. Economic system reform lays the material and ideological foundations for comprehensive reform by promoting economic development and providing people with more opportunities for development and free choice. Changes in the economic system inevitably induce profound transformations in the operational logic and institutional mechanisms of other critical fields, including politics, culture, society, ecology, innovation, security, and public welfare. Institutional disparities and demands for new rules generated by economic system reform constitute the endogenous impetus for parallel reforms in other areas, facilitating the diffusion of reform momentum across the broader institutional landscape. 
During the 15th Five-Year Plan period (2026-2030), efforts should be accelerated to establish a high-standard socialist market economy in accordance with the fundamental logic of Chinese modernization, and to take this as the fulcrum for better leveraging the leading role of economic system reform. Priority should be given to achieving a higher-level dynamic equilibrium between an efficient market and a well-functioning government, consolidating the micro-foundations of the market economy, constructing institutional mechanisms that support comprehensive innovation, and placing investment in people. These endeavors can drive supporting reforms in other fields and links, and will lay a solid institutional foundation for high-quality development and the advancement of Chinese modernization.

JEL: P21, O43, P26

【KeyWords】

Leading Role of Economic System Reform, Practical Pathways, Theoretical Logic, Priority Areas