How was the responsibility system an example of Deng's shift to a free-market economy?

It was the first time in the history of Communist China, that local managers were given authority and responsibility for profits and losses. It was one of the earliest seeds sowed by Deng to shift China into a free-market economy.

Explanation:

Also known as the Household Responsibility System, it came into effect in 1979 and was gradually adopted into other sectors of the society.

Under Mao's China, farmers were given early quotes to meet. Once completed, the farmer were rewarded. However, producing above this, did not have any benefit to the farmer, which resulted in low production and growth.

Deng started to change this with his new policies and by the 1980s, farmers were given small quotes and anything they produced above this, could be sold into the open market.

This gave a huge boost not just to agriculture production but also to living standards of locals.

The policy was tested in a small part of the country and generally kept a secret to test its implications. The huge success, gradually resulted in a roll out throughout China.

By the 1990's a much more Enterprising china had developed that was ready to take on the world.