This paper presents the initial results of the author’s attempt to assess the problems of price inflation in Mainland China. Its final objective is to construct a macro theory which is more appropriate for explaining the price inflation and inflationary pressures in Mainland China.
The paper first defines several important concepts, including price inflation and inflationary pressures, and discusses their measurement problems. Following the interpretation, classification and testing of various propositions on price inflation made by researchers and commentators in Mainland China, the author then develops a new theoretical framework, to serve as a guide to further research and testing. Finally, the paper briefly discusses the economic effects of the said inflation.
