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ZHANG YU & ZHAO FENG

This paper extends the empirical analysis of the movement of the rate of profit in the case of Chinese economy for the period 1978-2004. The rate of profit of manufacturing displays a declining tendency from the year 1978 to 1988, which precipitates in the period 1989-1998, and the tendency of the rate of profit becomes rising during the period 1999-2004. The rate of profit is viewed as the fundamental determinant of the rhythm of capital accumulation, and in the case of the Chinese economy the empirical evidence lends support to the idea that the movement of the rate of profit is consistent with the growth rate of output.