Have state policies under socialism radically and irrevocably transformed the Chinese countryside? Or do traditional attitudes and behaviour persist, fuelled by rural social structures that remain tenaciously vigorous despite new socialist imperatives? These questions have shaped much of the inquiry and debate on contemporary China over the past few decades. More recently, however, another promising line of argument has gained some currency. This approach does not pose the relationship between state control and traditional social structure as a “zero-sum conflict” in which the ascendancy of one is necessarily a loss for the other. Rather, it sees state and society as interacting in a more complex manner; a manner which is not always conflictual, and sometimes even quite complementary. By this view, certain policies of the Chinese state have contributed (albeit often unwittingly) to the survival and strengthening of traditional patterns of activity.

The early 1960s marked a period of intellectual and literary ferment in Taiwan. The East-West Controversy, which had its roots in the debate that took place in the middle of the last century regarding the continued validity of the Chinese tradition in the face of western military and economic superiority and in the controversy regarding westernization as the road to modernization in the 1930s, had broken out afresh. Creative writers, musicians and painters were experimenting with new forms and new techniques. As early as 1954 the writers of modern Chinese poetry had started the search for a more contemporary expression of their art form; and modern poetry societies, each with its own philosophy on how modernization should take place, had come into being. Writers of fiction who up till then had been almost exclusively concerned with the Sino-Japanese War; the mainland before the communist takeover in 1949, or the various aspects of the struggle against communism, were moving away from this kind of “propaganda-motivated writing” towards the production of “pure literature.” However, there were few modern Chinese creative writers of stature on whom either the poet or fiction writer could model himself. This was because of the ban imposed by the government in Taiwan on the works of writers prior to 1949 due to the association of many of them with communism or with ideologies unacceptable to the authorities. This meant that they had to seek for inspiration in the works of western writers which could be found in translation or in pirated versions of the original texts in the major cities of Taiwan. The traditionalists viewed this growing trend with alarm as did those writers who were closely associated with the Kuomintang. The latter had formed themselves during the early 1950s into three writers' associations, the China Association of Literature and Art, the Chinese Youth Writers' Association, and the Taiwan Women Writers' Association.

Rural markets and peasant marketing did not fare well during the Maoist era, which extended from well before the consolidation of communist power in China to the triumphal return of Deng Xiaoping as the central political figure in 1977. Maoist radicals, who in broad perspective may be said to have held the political initiative throughout the era, can be fairly characterized as having an anti-market mentality. While this set of attitudes derives in part from Marxism, it is also rooted in the ideological preconceptions of late-imperial Confucian bureaucrats. The Maoist elite in the People's Republic and the traditional bureaucratic elite of the late empire were equally unhappy with market exchange, and both showed a preference for redistribution.

After the 1927/28 upheaval in the communist movement, a complex relationship evolved between Chen Duxiu (1879–1942) and Leon Trotsky (1879–1940). To date little has been written about this relationship in the west. The relationship between Chen and Trotsky, however, deserves treatment in its own right for various reasons. First, an elucidation of the contacts between them should close a significant gap in the respective biographies of the two Opposition leaders. The intention is not only to define Trotsky's role as seen from Chen's perspective, but also to emphasize the Far Eastern component hitherto underestimated in biographies of Trotsky. Secondly, the reconstruction of the relationship between Chen and Trotsky constitutes an important, correcting supplement to our knowledge of the developments ( = Wirkungsgeschichte) of “Trotskyism” in China, as it has been described as a concrete phenomenon as well as an ideological-political undercurrent. Thirdly, a study of the relationship between Chen and Trotsky should provide a better understanding of relations between the Communists of China and of the Soviet Union.

In 1979 when debate over economic reform gained momentum, the future role of China's banking system became a major topic. Having fallen into obscurity during its merger of 1970–77 with the Ministry of Finance, the newly independent People's Bank of China became an aggressive advocate of reform. With its aim directed at the Ministry of Finance as well as local party “barons,” the bank's advocates called for an end to the Sovietinspired “Big Budget, Small Bank” financial system and to local Party interference in the bank's operations. Under this system, of which the 1956 credit reforms were a crucial part, the People's Bank had two principal functions. First, by carefully auditing the financial operations of all state enterprises, the bank was to ensure their adherence to the state plan. Bank credit was meant to compel enterprise management adherence to the state plans. The second function was a quantitative control of the nation's money supply. Bank supervision of enterprise finances was meant to be one way to this objective. But from its first efforts in 1955 to implement such micro-financial controls over the economy, the People's Bank encountered strong opposition from enterprise management, local bureaus of finance, the Ministry of Finance, and the Party apparatus. As a result, its supervisory function began to atrophy, leaving the bank to pursue control over the money supply. This it did primarily through reliance on its savings operations which, in contrast to enterprise supervision, enjoyed the strong support of the Party apparatus. By the height of the Cultural Revolution Party leftists saw the bank as a perfect object for bureaucratic “simplification.” Aside from its savings operations, its credit and even financial planning functions had become vestigal. Consequently, in 1970 the headquarters of the bank was dissolved and local bank branches merged with the budgetary system.

Post-Mao politics in the People's Republic of China has been largely the politics of reform. Probably crucial to the success of all other reforms is the major effort to restore and develop the Party's cadre management system. Indeed, this very argument is reflected in the recent official appreciation in China of Stalin's dictum “cadres decide everything,” accompanying the recognition that the current modernization drive requires massive qualitative elite transformation and that deficiencies in the cadre system have prevented such a transformation.