This paper starts from the problems of “optimal allocation of resources” and “satisfaction of reasonable demands” that economics should research on. First it analyzes the problems of development of productive forces, such as resource depletion, environmental pollution and serious ecological problems, which resulted from the overemphasis on profit maximization of production and the satisfaction of people’s unlimited demands under the guidance of Western mainstream economic theory; then it also analyzes the problem of production relations, such as low production enthusiasm and inefficient production, lacks of human motivation under the guidance of traditional political economics. Finally this paper points out that in the future, what guides China’s economic development should be a combination of both: when paying attention to the development of productivity, we should also be concerned on improving the relations of production and innovated political economics with the interaction between productive forces and production relation, which is the future development direction of Chinese economics.
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