Markets and Plans

China, one has been told since Deng Xiaoping’s market-oriented reforms began in the late 1970s, is becoming capitalist. So is the Soviet Union under Gorbachev, similarly with Hungary, Angola, Vietnam, and all the other economies that were once centrally planned and have now introduced markets to achieve efficient production.

If this were simply one more example of a superficial journalistic dichotomy—either a society is planned and socialist or relies on markets and is capitali...