This paper investigates the macroeconomic cycles China has experienced since the onset of reform in the Iate l970s．First，a detailed description of each of the four cycles since l978 focuses on developments in key economic variables in each episode．Subsequently．employing a simple Philips curve model，an econometric investigation confirms the anecdotal evidence that the inflationary episodes have generally been associated with surges in aggregate demand．It is argued．however，that the factors behind the upswings and relative importance of the components of aggregate demand have differed across cycles．The most recent cycle stands out in having achieved a soft landing for the first time，combining a significant reduction in inflation with only a mod erate slowing of growth．W hile the paper under．ores the role of a number of structural and policy factors widely believed to have facilitated the,soft landing，it argues that there is an additiona1 important factor．The fourth cycles differed from previous cycles in that aggregate demand in the upswing was fueled mainly by a surge in investment spending．Although the strong investment demand initially increased aggregate demand more than supply——increasing inflationary pressures——it eventually Ied to an increase in capacity and potentia1 output，which tended to dampen inflationary pressures and allowed the economy to settle into a soft landing despite continued strong real GDP growth