The Political Development Cycle: The Right and The Left in People's Republic of China from 1953

We quantify the effects of the political development cycle – the fluctuations between the left (Maoist) and the right (pragmatist) development policies – on growth and structural transformation of China in 1953-1978. The left policies prioritized structural transformation towards non-agricultural production and consumption at the cost of agricultural development. The right policies prioritized agricultural consumption through slower structural transformation. The substantial differences in policies and their volatility led to large effects of the political development cycle in a distorted economy undergoing a structural change compared to the political business cycle in developed economies.