Price adjustment policy (pingzhunfa 平準法, zhunping 準平, ping 平, zhun準, zhunheng 準衡), particularly for the price of grain, was introduced during the Han period 漢 (206 BCE-220 CE) and remained a substantial aspect of economic policy through the ages.
The term first appears in the book Guanzi 管子 (ch. Guochu 國蓄), and similar ideas were found in the thought of Fan Li 范蠡. The office of overseer of merchants (gushi 賈師) is mentioned in the ritual Classic Zhouli 周禮 (part Diguan 地官). Fan Li 范蠡 stressed the need of circulating money to control prices. He advocated a price of per shi 石 of grain (see weights and measures) of between 30 and 80 (units), in order to profit both producers and vendors. The government therefore had to carry out a policy of government purchase of grain (pingdi 平糴). Similar statements were also known from Li Kui 李悝.
Backed by Sang Hongyang 桑弘羊 (152-80 BCE), Emperor Wu 漢武帝 (r. 141-87 BCE) decided in 110 BCE to introduce the price adjustment policy, organized by an institution called Bureau of Standards (pingzhun 平準) which was headed by a Director (pingzhun ling 平準令) who was under the jurisdiction of the Chamberlain of the National Treasury (danong ling 大農令). The Bureau controlled the prices of all "tribute products" delivered from the provinces to the capital, as well as various objects manufactured for the court and the capital. The procedure was the same as with the ever-normal granaries (changpingcang 常平倉) which followed a system of buying commodities when and where the price was low. They were kept in storehouses and granaries, and brought in higher quantities on the market in times of inflation, in order to lower the market prices. This method would on the one hand stabilize prices of staple goods, and on the other hand curb speculative purchase and selling. It must be notified that the government did only set upper limits for prices, but did not request a minimum price for the commodities in question.
Yet cooperation between the officialdom and merchants might result in purposeful speculation, for which reason a conference in 81 BCE on the state monopoly of salt and iron harshly criticized the price adjustment policy, but the system was not abolished.
The price adjustment policy directly influenced the creation of ever-normal granaries in 54 BCE by Geng Shouchang 耿壽昌. The usurper Wang Mang 王莽 (r. 8-23 CE) even extended it to other commodities by way of his policy of the "five equalizations and six controls" (wujun liuguan 五均六筦). The price adjustment policy was applied in five cities, namely Chang'an 長安 (today's Xi'an 西安, Shaanxi), Luoyang 洛陽 (Henan), Handan 邯鄲 (Hebei), Linzi 臨淄 (Shandong), Wan 宛 (today's Nanyang 南陽, Henan), and Chengdu 成都 (Sichuan), and was applied to the state monopoly on the production and merchandise on salt, iron, ferments, coins and ores and other "products of mountains and swamps".
During the Later Han period, the power of the Bureau was curtailed, and it was not any more able to directly determine market prices. In 175 CE, the Bureau was renamed *Palace Bureau of Standards (zhongzhun 中準) and made an agency under the control of palace eunuchs (neishu 內署).
The history book Shiji 史記 has a particular treatise chapter dealing with the Bureau (ch. 30 Pingzhun shu 平準書).
The price control went hand in glove with the equal-transport policy (junshufa 均輸法) introduced in 122 BCE by which the government controlled the purchase, transport and selling of selected products. *Equal-transport bureaus (junshu 均輸) were located in each commandery, while there was only one Price Adjustment Bureau, in the capital.
The policy was revived under the Tang dynasty 唐 (618-907), when Liu An 劉晏 (715-780) tried to control the grain prices of Chang'an. He also introduced a new taxation model, the twice-taxation system (liangshuifa 兩稅法), and revived the price control of salt by the "ever-normal salt policy" (changping yan 常平鹽), which worked similar to the ever-normal granaries, and adjusted the salt price to a stable average.
Wang Anshi's 王安石 (1021-1086) reformist market exchange policy (shiyifa 市易法) of the Song period 宋 (960-1279) was likewise a revival of the Han price policy. Wang renamed the market exchange bureaus (shiyisi 市易司) price adjustment offices (pingzhunwu 平準務). Yet while Han government institutions directly steered market prices by purchasing and selling commodities, the Song administration operated by credit models and had licensed brokers (hangren 行人, yaren 牙人) take control over market prices. Wang Anshi had commodities bought in the southeastern circuits at low prices, having paid them with credit or tax revenue, and shipped them to the capital, to be stored for years and seasons when prices in the capital soared.
After the Song period, the system of ever-normal granaries was retained, but direct price control of grain and other products was left to the market, with some exceptions, like salt and tea.