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  • Author: Masahiko Aoki
  • Publication Date: 06-2014
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper argues that game-theoretic approach is incomplete for institutional studies, because comparative institutions as well as institutional changes involve a possibility of multiple equilibria. In order to solve the common knowledge problem, this paper proposes to unify game theoretic thought with an analysis of public representations/propositions to summarize salient features of the recursive/emergent states of play. From this perspective the paper tries to reconcile differences in three accounts of institutions, endogenous outcome, exogenous rules and constitutive rules accounts. Then, the unified approach is applied to comparative and historical cases of the Tokugawa Japan and the Qing China. Specifically it sheds new light into the coalitional nature of Tokugawa Baku-Han regime nesting the fundamental Samurai-village pact as well as the tendency toward decentralization of political violence and fiscal competence to the provincial level toward the end of the Qing China. From these new historical interpretations, endogenous strategic forces and associated public propositions leading to institutional changes through the Meiji Restoration and the Xinhai Revolution are identified and compared.
  • Topic: Nationalism, Political Theory, Governance
  • Political Geography: China
  • Author: Brian K. Chen
  • Publication Date: 09-2013
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: How do demand - and supply - side incentives interact, when there are potentially large provider income effects? We develop a simple model and empirically test it with data from China's Essential Medications List (EML) policy, which reduced patient copayments and changed provider incentives by removing a large source of revenue from primary care providers: drug dispensing revenues. Using a panel of patient - level spending and clinical data for Chinese patients with diabetes or hypertension over two and a half years, we find evidence of strategic provider response that dampened the impact of patient copayment reductions. Resource use and patient out - of - pocket spending did not change, when taking account of patient utilization outs ide primary care.
  • Topic: Communism, Health, Governance
  • Political Geography: China, Israel
  • Author: Walter H. Shorenstein
  • Publication Date: 06-2013
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Meeting after North Korea had raised tensions on the Korean Peninsula in the spring, participants in the Tenth Korea-U.S. West Coast Strategic Forum focused on the implications for the Korean Peninsula of leadership changes in North and South Korea and especially China. Participants also focused on regional dynamics, including increased confrontation between China and Japan and various, sometimes conflicting, efforts to increase regional economic integration in Northeast Asia.
  • Topic: Conflict Resolution, Defense Policy, Arms Control and Proliferation, Diplomacy, Nuclear Weapons, Weapons of Mass Destruction, Bilateral Relations, Sanctions
  • Political Geography: United States, Japan, China, Israel, Asia
  • Author: Qiong Zhang, Binzhen Wu, Xue Qiao
  • Publication Date: 01-2012
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper uses macro-level data between 1997 and 2008 to evaluate the effects of China's pharmaceutical price regulations. We find that these regulations had short-run effects on medicine price indexes, reducing them by less than 0.5 percentage points. The effects could have been slightly reinforced when these regulations were imposed on more medicines. However, these regulations failed to reduce household health expenditures and the average profitability of the pharmaceutical industry, and firms on the break-even edge were worse off. Finally, although these regulations have no significant effects on the price of substitutes or complements for medicines, they increased expensive medicine imports.
  • Topic: Economics, Health, Human Welfare, Industrial Policy, International Trade and Finance, Markets
  • Political Geography: China
  • Author: Qiong Zhang, Chong-En Bai
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China's economic growth over the past three decades is unprecedented. Although this growth is commonly attributed to a high domestic savings rate among “thrifty” Chinese, savings alone cannot promote economic growth unless productivity has continuously grown for such a long period. This article uses a one-sector, neoclassical growth model to calibrate the economy to Chinese data since 1952 and finds that measuring changes in total factor productivity between 1952 and 2005 can well capture the secular movements in the Chinese savings rate. Far from supporting the widespread belief that China's savings rate is too high, this article argues that even thrifty Chinese “under-saved” for most of the years during this period; furthermore, the fiscal reforms of 1983 and 1985 further suppressed saving behavior, especially China's economic growth over the past three decades is unprecedented. Although this growth is commonly attributed to a high domestic savings rate among “thrifty” Chinese, savings alone cannot promote economic growth unless productivity has continuously grown for such a long period. This article uses a one-sector, neoclassical growth model to calibrate the economy to Chinese data since 1952 and finds that measuring changes in total factor productivity between 1952 and 2005 can well capture the secular movements in the Chinese savings rate. Far from supporting the widespread belief that China's savings rate is too high, this article argues that even thrifty Chinese “under-saved” for most of the years during this period; furthermore, the fiscal reforms of 1983 and 1985 further suppressed saving behavior, especially when initially implemented. In presenting such findings, this article at least partly solves the so-called “Chinese savings puzzle.”
  • Topic: Development, Economics, International Trade and Finance, Monetary Policy
  • Political Geography: China
  • Author: Qunhong Shen, Liyang Tang, Yilin Feng, Jenny Tang
  • Publication Date: 11-2010
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The increasing importance of patient satisfaction is a common trend for the global health delivery system. This development is one of the consequences of wider social movements toward consumerism (Sitzia and Wood 1997) and also is the result of the new public management (Christoffer 2002).
  • Topic: Communism, Development, Government, Health Care Policy
  • Political Geography: China
  • Author: Meghan Bruce
  • Publication Date: 10-2010
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Since 1978, China has been primarily market-focused in its provision of health care and social services. The market-driven health care system has been characterized by perverse incentives for individual providers, patients, and hospitals that are inducing improper provision of care: overprescription of pharmaceuticals and hightech testing, lack of effective primary care and gatekeeping, and competition for patients instead of referral. The national health care reform document that was made public in April 2009 recognizes this failure of the market in health care in China. The document suggests potential policies for improvement on the current system that are focused primarily on a targeted increase in government funding and an increased, changing role for the government. We assess the potential of this national health care reform to achieve the stated goals, and conclude that the reform as designed is necessary but insufficient. For the reform to meet its goals, the promised increase in funding should be accompanied by improved data collection, regional piloting, and a strong regulatory and purchasing role for the government in aligning incentives for individual and institutional payers, providers, and patients.
  • Topic: Health, Markets
  • Political Geography: China, Israel
  • Author: Qunhong Shen, Liyang Tang
  • Publication Date: 09-2010
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Many Chinese express dissatisfaction with their healthcare system with the popular phrase Kan bing nan, kan bing gui ("medical treatment is difficult to access and expensive"). Critics have cited inefficiencies in delivery and poor quality of services. Determining the pattern of patient satisfaction with health services in China-and the causes of patient dissatisfaction-may help to improve health care not only in China but in countries in similar predicaments throughout the world.
  • Topic: Economics, Markets, Social Stratification, Health Care Policy
  • Political Geography: China
  • Author: Donald K. Emmerson
  • Publication Date: 02-2009
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: No crisis is uniformly global. The suffering and the opportunity that a “global” crisis entails are always unevenly distributed across countries, and unevenly across the population inside any one country. That said, one can nevertheless argue that we—not the old royal “we” but, more presumptuously, the new global “we”—are in January 2009 experiencing the latest of four dramatic changes that major parts of the world have undergone over the last twenty years. In 1989, of course, the Berlin Wall was breached, ending the Cold War, followed by the implosion of Lenin's Soviet dystopia two years later. Nor did the 1989 massacre of proreform demonstrators in Tiananmen Square revive a command economy in China. Instead it kept the polity shut so that Deng's economy could continue to open.
  • Topic: International Relations, Globalization, International Political Economy
  • Political Geography: United States, China, America, Israel, Asia, Berlin
  • Author: Zhe Zhang, Ming Jia, Difang Wan
  • Publication Date: 03-2009
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This article uses incomplete contract theory to study the allocation of control rights in public-private partnerships (PPPs) between pharmaceutical enterprises and nonprofit organizations; it also investigates how this allocation influences cooperation efficiency. We first develop a mathematic model for the allocation of control rights and its influence on cooperation efficiency, and then derive some basic hypotheses from the model. The results of an empirical test show that the allocation of control rights influences how enterprises invest in PPPs. A proper allocation provides incentives for firms to make fewer self-interested and more public-interested investments. Such an allocation also improves the cooperation efficiency of PPPs.
  • Topic: Demographics, Health, Human Welfare
  • Political Geography: China, Israel, Asia
  • Author: Karen Eggleston, Mingshan Lu, Congdong Li, Jian Wang, Zhe Yang, Jing Zhang
  • Publication Date: 04-2009
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Government and private roles in this segment of health service delivery remain controversial in China, as in many countries. Using 2004 data from over 360 government-owned and private hospitals in Guangdong Province, we find that non-government hospitals serve an overlapping but distinct market. They are smaller, newer market entrants, more likely to specialize, and less likely to be included in urban social insurance networks. We also document differences in staffing and financial performance, but no systematic ownership differences in simple measures of quality, controlling for size, location, case-mix and other confounding factors.
  • Topic: Demographics, Government, Health, Privatization
  • Political Geography: China, Israel, Guangdong
  • Author: Karen Eggleston, Mingshan Lu, Congdong Li, Jian Wang, Zhe Yang, Jing Zhang, Yu-Chu Shen
  • Publication Date: 03-2009
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Using data from 276 general acute hospitals in the Pearl River Delta region of Guangdong Province from 2002 and 2004, we construct a preliminary metric of budget constraint softness. We find that, controlling for hospital size, ownership, and other factors, a Chinese hospital's probability of receiving government financial support is inversely associated with the hospital's previous net revenue, an association consistent with soft budget constraints.
  • Topic: Government, Health, Financial Crisis
  • Political Geography: China, Asia
  • Author: Cunrui Huang, Haocai Liang, Cordia Chu, Shannon Rutherford, Qingshan Geng
  • Publication Date: 09-2009
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China continues to face great challenges in meeting the health needs of its large population. The challenges are not just lack of resources, but also how to use existing resources more efficiently, more effectively, and more equitably. Now a major unaddressed challenge facing China is how to reform an inefficient, poorly organized health care delivery system. The objective of this study is to analyze the role of private health care provision in China and discuss the implications of increasing private-sector development for improving health system performance.
  • Topic: Government, Health
  • Political Geography: China, Asia
  • Author: Dennis Arroyo
  • Publication Date: 06-2008
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Major economic reforms are often politically difficult, causing pain to voters and provoking unrest. They may be opposed by politicians with short time horizons. They may collide with the established ideology and an entrenched ruling party. They may be resisted by bureaucrats and by vested interests. Obstacles to major economic reform can be daunting in democratic and autocratic polities alike.
  • Topic: Economics, Government, Political Economy
  • Political Geography: China, India, Asia, South Korea, Vietnam, Singapore, Thailand
  • Author: Karen Eggleston
  • Publication Date: 10-2008
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The economic approach of comparative and historical institutional analysis (Aoki 2001, Greif 2006) has virtually never been used in theoretical studies of healthcare incentives. This paper seeks to help fill this gap by exploring the explanatory power of such an approach for understanding incentives in China's healthcare delivery system. It focuses on positive analysis of why China's health system incentives evolved the way they did. The first section analyzes the institution of physician dispensing (MDD) and reforms toward separation of prescribing from dispensing (SPD), in historical and comparative perspective. It shows, for example, how MDD was a self-reinforcing institution; the longer a society remains under MDD, the higher the associated costs of supplier-induced demand can be before implementing SPD becomes the efficient self-enforcing social institution. Rapid technological change and adoption of universal coverage are likely to trigger SPD reforms. The second section seeks to explain the pattern and impact of price regulation and hospital payment reforms in contemporary China, which also reflect the legacy of MDD.
  • Topic: Government, Health, Human Welfare
  • Political Geography: China, Israel, Asia
  • Author: Fangbin Qiao, Jim Wilen, Jikun Huang
  • Publication Date: 02-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The goal of this study is to discuss why China and perhaps other developing countries may not need a refuge policy for Bacillus thuringiensis (Bt) cotton. We describe in detail the different elements that a nation—especially a developing one—should be considering when deciding if a refuge policy is needed. Drawing on a review of scientific data, economic analysis of other cases and a simulation exercise using a bio-economic model that we have produced to examine this question, we show that in the case of Bt cotton in China, the approach of not requiring special cotton refuges is defensible.
  • Topic: Agriculture, Economics
  • Political Geography: China, Asia
  • Author: Jikun Huang, Jun Yang, Scott Rozelle
  • Publication Date: 02-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China's economy has experienced remarkable growth since economic reforms were initiated in the late 1970s and pushed forward by a number of complementary policies. Since the mid-1980s, rural township and village-owned enterprises (TVEs) development; measures to provide a better market environment through domestic market reform; fiscal and financial expansions; the devaluation of exchange rate; trade liberalisation; the expansion of special economic zones to attract foreign direct investment (FDI); the state-owned enterprise (SOE) reform; agricultural market liberalisation, and many other reforms have all contributed to China's economic growth. In response, the annual growth rate of gross domestic product (GDP) was about nearly 10% in 1979–2004 (National Bureau of Statistics of China 2005).
  • Topic: Agriculture, International Trade and Finance
  • Political Geography: China, Asia, Australia, Australia/Pacific
  • Author: Xiaopeng Pang, Scott Rozelle
  • Publication Date: 01-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The goal of our paper is to provide an empirical basis for understanding progress (or stagnation) in the evolution of China's village committee elections. To meet this goal, we pursue three specific objectives. First, we seek to identify patterns (and trends) of voting behavior and develop ways to measure participation in the voting process. Second, we analyze who is voting and who is not (and document the process by which their votes are cast). Finally, we see to understand the correlation between propensity to vote and the quality of village elections.
  • Topic: Government, Politics
  • Political Geography: China, Asia
  • Author: Jikun Huang, Renfru Luo, Linxiu Zhang, Scott Rozelle
  • Publication Date: 01-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: A key issue in political economy concerns the accountability that governance structures impose on public officials and how elections and representative democracy influences the allocation of public resources. In this paper we exploit a unique survey data set from nearly 2450 randomly selected villages describing China's recent progress in village governance reforms and its relationship to the provision of public goods in rural China between 1998 and 2004. Two sets of questions are investigated using an empirical framework based on a theoretical model in which local governments must decide to allocate fiscal resources between public goods investments and other expenditures. First, we find evidence—both in descriptive and econometric analyses—that when the village leader is elected, ceteris paribus, the provision of public goods rises (compared to the case when the leader is appointed by upper level officials). Thus, in this way it is possible to conclude that democratization—at least at the village level in rural China—appears to increase the quantity of public goods investment. Second, we seek to understand the mechanism that is driving the results. Also based on survey data, we find that when village leaders (who had been elected) are able to implement more public projects during their terms of office, they, as the incumbent, are more likely to be reelected. In this way, we argue that the link between elections and investment may be a rural China version of pork barrel politics.
  • Topic: Democratization, Government, Political Economy, Politics
  • Political Geography: China
  • Author: Jikun Huang, Keijiro Otsuka, Scott Rozelle
  • Publication Date: 01-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The view toward agricultural and rural development in the modern world has changed dramatically in the past several decades. Traditionally, agriculture was thought of an inferior partner in development. Since the size of the sector falls during development, it was logically considered that it could be ignored. Why is that leaders would ever want to invest in a sector that shrinking? Some academics urged policy makers to treat agriculture like a black box from which resources could be costlessly extracted (Lewis, 1954). All investment was supposed to be targeted at the industry and the cities. As a low productivity sector, it did not deserve investment.
  • Topic: Agriculture, Development, Industrial Policy
  • Political Geography: China, Asia
  • Author: Jikun Huang, Qiuqiong Huang, Richard Howitt, Jinxia Wang
  • Publication Date: 02-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: As water becomes scarcer in northern China, designing policies that can induce water users to save water has become one of the most important tasks facing China's leader. Past water policies may not be a solution for the water scarcity problem in the long run. This paper looks at a new water policy: increasing water prices so as to provide water users with direct incentives to save water. Using a methodology that allows us to incorporate the resource constraints, we are able to recover the true price of water with a set of plot level data. Our results show that farmers are quite responsive if the correct price signal is used, unlike estimates of price elasticities that are based on traditional methods. Our estimation results show that water is severely under priced in our sample areas in China. As a result, water users are not likely to respond to increases in water prices. Thus as the first step to establishing an effective water pricing policy, policy makers must increase water price to the level of VMP so that water price reflects the true value of water, the correct price signal. Increases in water prices once they are set at the level of VMP, however, can lead to significant water savings. However, our analysis also shows that higher water prices also affect other aspects of the rural sector. Higher irrigation costs will lower the production of all crops, in general, and that of grain crops, in particular. Furthermore, when facing higher irrigation costs, households suffer income losses. Crop income distribution also worsens with increases in water prices.
  • Topic: Agriculture, Economics, Environment
  • Political Geography: China, Asia
  • Author: Jikun Huang, Qiuqiong Huang, Jinxia Wang, Scott Rozelle
  • Publication Date: 02-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Increasing demand for China's limited water resources (across China, but mostly in northern China) from rapidly growing industry, urban populations and agriculture implies potentially dire consequences for the sustainability of water use and drastic changes in cultivation patterns (Zhang, 2001). Problems in the water sector also have significant implications for China's future trade position in key crops and may affect the income of the farming sector (Huang et al., 1999).
  • Topic: Agriculture, Development, Environment, Government
  • Political Geography: China, Asia
  • Author: Siwa Msangi, Qiuqiong Huang, Jinxia Wang, Jikin Huang, Scott Rozelle
  • Publication Date: 02-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper explains the puzzling fact that in organizing the management of surface water, village leaders have provided incentives to canal managers in some areas, but not in all. Our study indicates that the optimal contractual choice depends on the relative abilities of the leader and the manager, the design of the cultivated land, the characteristics of the canal system and the opportunity costs of the leader and the pool of managerial candidates. The unifying mechanism is the relative change in the ability of the leader and manager to perform the unmarketable activities that are needed to provide irrigation services.
  • Topic: Agriculture, Development, Environment, Government
  • Political Geography: China
  • Author: Johan Swinnen, Scott Rozelle
  • Publication Date: 01-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The dramatic transition from Communism to market economies across Asia and Europe started in the Chinese countryside in the 1970s. Since then more than a billion of people, many of them very poor, have been affected by radical reforms in agriculture. However, there are enormous differences in the reform strategies that countries have chosen. This paper presents a set of arguments to explain why countries have chosen different reform policies.
  • Topic: Agriculture, Development, Government, Political Economy
  • Political Geography: Russia, China, Europe, Asia, Soviet Union
  • Author: Jikun Huang, Johan Swinnen, Marcel Fafchamps, Tom Reardon, Bart Minten, Scott Rozelle
  • Publication Date: 03-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: To lift more than 10,000 farmers directly out of poverty by developing new Best-Practice Models for linking the poor to modern supply chains and after scaling up by our private and public partners to lift more than 1 million farmers out of poverty.
  • Topic: Agriculture, Development, Non-Governmental Organization, Poverty
  • Political Geography: Africa, China, India, Asia, Senegal, Madagascar
  • Author: Jikun Huang, Qiuqiong Huang, Jinxia Wang, Jun Xia, Scott Rozelle, Dean Karlan
  • Publication Date: 01-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Water scarcity is one of the key problems that affect northern China, an area that covers 40 percent of the nation's cultivated area and houses almost half of the population. The water availability per capita in North China is only around 300 m per capita, which is less than one seventh of the national average (Ministry of Water Resources, 2002). At the same time, expanding irrigated cultivated area, the rapidly growing industrial sector and an increasingly wealthy urban population demand rising volumes of water (Crook, 2000, Wang, et al., 2005). As a result, groundwater resources are diminishing in large areas of northern China (Wang, et al., 2005). For example, between 1958 and 1998, groundwater levels in the Hai River Basin fell by up to 50 meters in some shallow aquifers and by more than 95 meters in some deep aquifers (Ministry of Water Resource, et al., 2001).
  • Topic: Agriculture, Development, Environment, Government, Industrial Policy
  • Political Geography: China
  • Author: Scott Rozelle
  • Publication Date: 04-2007
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The purpose of this executive summary is to provide a concise statement about what we have learned about investment into China's rural environment. The overall purpose is to help the Bank understand what is happening in rural China, what farmer's are thinking about the current trends and what they are hoping will happen in the future (if they had a say). One of the most important questions is answer what should the role of the state be.
  • Topic: Development, Environment, Political Economy
  • Political Geography: China, Asia
  • Author: Douglas Webster, Jianming Cai, Binyi Luo, Larisa Muller
  • Publication Date: 10-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Hangzhou Municipality is the provincial capital of Zhejiang, on China's east coast. It forms part of the Yangtze River Delta (YRD) region. Hangzhou was “opened up” in the mid-1980s, following Deng Xiaoping's visit to the South, resulting in an almost immediate flood of foreign and domestic investment in manufacturing. This initial investment was significantly in the peri-urban areas, i.e., outside the built-up area. The authors have been following development in the Hangzhou extended urban region, with emphasis on peri-urbanization processes, since 2000. A previous APARC discussion paper describes findings of preliminary field research on the Hangzhou–Ningbo Corridor, conducted in August 2000 and March 2001. The present paper zooms in on two peri-urban clusters in the Hangzhou extended urban region, and assesses their development over time. The goal of the research is to better understand how a peri-urban region changes—particularly in terms of firm evolution, labor characteristics, and spatial dynamics—as it becomes more economically and demographically mature. This paper also examines such changes in the context of the increasing cost structures and emerging competitors, primarily from other areas in China, that the Hangzhou peri-urban region now faces.
  • Topic: Demographics, Economics, Industrial Policy
  • Political Geography: China, Asia, Maryland
  • Author: Douglas Webster, Jianming Cai, Binyi Luo, Annemarie Schneider, Karen C. Seto
  • Publication Date: 10-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Chengdu, the provincial capital of Sichuan, has undergone rapid transformation during China's post-reform period between 1978 and 2003. One of the leading cities in southwest China, Chengdu is second only to Chongqing in population. Chengdu anchors one end of the Chongqing-Chengdu urban corridor, the fourth most populous urban cluster in China. Although the upgrading of Chongqing Municipality to the equivalent of provincial status in 1997 has increased the city's profile and potential as an administrative, land transportation, and manufacturing center, it is expected that Chengdu's regional and strategic importance as a service and high-tech center will increase in the future. With increased economic specialization among Chinese cities, it is expected that Chengdu and Chongqing cities will increasingly complement each other in terms of function, both enhancing their developmental prospects as a result. Further, the development of western China is a major objective of the Tenth Five Year Plan. The “Go West” policy was introduced in 1999.
  • Topic: Economics, Government, Politics
  • Political Geography: China, Asia, Chongqing, Chengdu
  • Author: Lawrence J. Lau, Guijuan Wang
  • Publication Date: 09-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The Chinese economy has had the highest rate of growth in the world in the past two decades. However, despite its rapid growth and the significant improvements in its financial system, serious risks and problems still exist in both the commercial banking sector and the stock market, that may potentially threaten the stable development and growth of the entire economy. In this paper, these risks and problems in the stock market and the commercial banking sector are identified. Possible solutions are then discussed. Finally, tax reforms are proposed that have the effects of (1) eliminating the double taxation on cash dividends from corporate profits; (2) encouraging the substitution of new equity for existing debt by corporations, which can lower the P/E ratios without lowering the stock prices and improve quality of commercial bank assets by reducing the probability of new nonperforming loans; and (3) attracting new and longer-term investors, both domestic and foreign, to the Chinese stock market. It is also shown that the proposed tax reforms will not result in a significant reduction in total fiscal revenue.
  • Topic: Economics, Government
  • Political Geography: China, Asia
  • Author: Mary Comerford Cooper
  • Publication Date: 06-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper considers two questions. First, why did the Chinese government establish stock markets? Second, how have political interests shaped the key features of these markets? Based on both interviews and statistical analysis, the paper argues that China's top Party-State leaders attempted to create stock market institutions that allow the state to maintain control over listed companies, and over “the market” as a whole.
  • Topic: Economics, Government
  • Political Geography: China, Israel, East Asia, Asia
  • Author: Mary Comerford Cooper
  • Publication Date: 04-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper examines a key aspect of the politics of stock markets in China—the distinct differences in interests between central government leaders and local governments. Central government leaders have a powerful incentive to promote macroeconomic stability and good performance of the stock market. Local leaders, for their part, are less concerned with the overall performance of the stock market than with gaining access to the stock market for companies under their own jurisdiction. The paper demonstrates that company listing brings tangible economic benefits to municipalities. Listed companies are associated with higher levels of gross domestic product (GDP), budgetary revenue, and industrial and commercial tax revenue. Therefore, it is not surprising that local officials put substantial effort into lobbying for the right to list additional companies on the national stock exchanges.
  • Topic: Communism, Democratization, Economics, Government
  • Political Geography: China, Asia
  • Author: Andrew G. Walder
  • Publication Date: 04-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Despite skepticism about official economic statistics, there is little doubt that China since 1978 has undergone an economic transformation of historic proportions. This outcome stands in stark opposition to arguments that were once widely accepted in several scholarly communities, and which are still highly influential even today. In the early 1980s there was wide agreement that “partial” reform, under a single party dictatorship that sought indefinitely to preserve public ownership, was a recipe for failure. China specialists, students of comparative economic systems, and economists who advised governments and international agencies about postcommunist restructuring in Eurasia were initially in broad agreement on this point.
  • Topic: Economics, Government, Politics
  • Political Geography: China, Asia
  • Author: Mary Comerford Cooper
  • Publication Date: 04-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Does the World Trade Organization promote democracy? A large part of the heated and protracted debate over China's application for WTO membership revolved around this question. Prior to China's WTO accession in December 2001, this debate had dragged on for nearly fifteen years. While one side argued that WTO membership would promote democratization in China, others argued that the wealth generated through economic integration would provide the resources to maintain authoritarian rule. Only time will tell whether WTO accession will contribute to pressures for democratization in China. In the meantime, however, this paper examines the empirical basis for these competing claims about the effects of GATT/WTO memberships on domestic political systems. Based on statistical analysis of a global data set, this paper concludes that members of the international trade regime are more likely than nonmembers to be democracies. However, there is little evidence that WTO membership in itself can promote democratic transition. Instead, it appears to be the case that democratic countries are more likely to seek to join the WTO.
  • Topic: Communism, Democratization, Economics, Government
  • Political Geography: China, Asia
  • Author: Andrew G. Walder
  • Publication Date: 04-2003
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Command economies gave communist-era elites administrative control and material privilege but severely restricted money income and private wealth. Markets and privatization inject new value into public assets and create unprecedented opportunities for elite insiders to extract incomes or assume ownership. These opportunities vary with the extensiveness of regime change and the barriers to asset appropriation. Within these limits, they further vary with the concentration and form of economic assets and structural changes induced by reform. Elite advantages are smallest where regime change is extensive and barriers to asset appropriation are high, and in small-scale economies that grow rapidly. In China, there has been no regime change and privatization has been delayed and slow. In the rural economy, elites keep their posts as a source of economic advantage, while low entry barriers to household enterprise and rapid growth have created new entrepreneurial elites. After two decades, rural officials nonetheless enjoy large net income advantages that grow along with the expansion of labor markets and private entrepreneurship. These are not generic outcomes of market reform, but the product of market reform in distinctive political and structural conditions.
  • Topic: Communism, Economics, Government, International Trade and Finance
  • Political Geography: China, Asia
  • Author: Andrew G. Walder, Litao Zhao
  • Publication Date: 12-2002
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: For more than two decades after the demise of Maoist collectivism, a resurgent market economy has deeply transformed the social structure of rural China. By the mid-1980s, peasant households had already returned to historical marketing patterns of agricultural produce and other sidelines and services. By the turn of the century, almost 140 million individuals, or 30 percent of the rural labor force, earned regular incomes from wage labor outside agriculture. Twenty million rural households had registered individual family enterprises, and two million of them had already grown into substantial private firms. A massive rural industrial sector grew up under public ownership in the 1980s, employing more than 80 million at its height. It was then extensively privatized in the 1990s, and is now less than half its former size. While these developments have been widely noted in studies of rural industrialization and income inequality, it is still far from clear how they have altered the structure and wealth of village political and economic elites.
  • Topic: Communism, Economics, Politics
  • Political Geography: China, Asia
  • Author: Jimmy Carter
  • Publication Date: 08-2002
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The Oksenberg Lectures honor the legacy of Professor Michel Oksenberg (1938–2001), Senior Fellow at the Asia/Pacific Research Center, professor of political science, and a foremost authority on China.
  • Topic: Development
  • Political Geography: China, Israel, East Asia, Asia
  • Author: Andrew G. Walder
  • Publication Date: 07-2002
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The ideal types that motivate research on transitional economies have led to a neglect of the varied mechanisms that generate social change. One example is the implicit treatment of privatization as a single process whose initial impact will become more pronounced through time. Privatization in fact occurs via distinct mechanisms that have different consequences across types of assets and through time, as shown in an analysis of career trajectories over two decades in rural China. During the first decade, when privatization proceeded via the rapid expansion of household enterprise, ordinary individuals with nonagricultural work experience were the most likely to become private entrepreneurs. Village officials, their relatives, and public enterprise managers did not enter the private sector at rates higher than others. However, during the second decade the privatization of public enterprises began to transfer collective assets to individual ownership. During this period, public enterprise managers and the relatives of cadres emerged as the most likely to become private entrepreneurs. Private entrepreneurs, however, have yet to move into cadre posts, and cadres have yet to move into private entrepreneurship, at rates higher than others. Administrative elites have therefore proven resilient in the face of private-sector expansion, and the benefits of privatization have gradually shifted in their favor.
  • Topic: Communism, Economics
  • Political Geography: China, Asia
  • Author: Douglas Webster
  • Publication Date: 05-2002
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This discussion paper is based on analysis of peri-urbanization dynamics in the Hangzhou- Ningbo Corridor of the Lower Yangtze Region of China. The case-study area is of particular interest, both because of the scale of the phenomenon in the area and the fact that the corridor typifies the long-running and dynamic peri-urbanization process occurring in the Lower Yangtze Region as a whole, arguably the world's largest extended urban region (EUR). Analysis focuses on adaptation, successful and otherwise, to the severe stresses, demographic, social, and environmental, accompanying peri-urbanization. Policy implications are then drawn; anticipated future stresses in the case-study area, and by implication the larger extended urban region, are used to trigger recommendations.
  • Topic: Development
  • Political Geography: China
  • Author: Thomas P. Rohlen
  • Publication Date: 07-2000
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Now, more than at any point since 1949, Hong Kong's economic future is tied to that of China. This commonplace observation must be coupled with the less obvious, but equally fundamental point that Hong Kong's future with China is based largely on activities that arise in or pass through the Pearl River Delta. This region, however, is cut in half by a sovereign border and governed by a patchwork of political authorities. The Delta as a whole is rich with opportunities, but it is increasingly apparent that these can be realized only if integration moves forward, both in a metropolitan and regional sense. This prospect is currently marked by serious uncertainties.
  • Topic: Security
  • Political Geography: United States, China, Asia, Hong Kong
  • Author: Steven M. Goldstein
  • Publication Date: 02-2000
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This paper discusses the relationship between the United States and the Republic of China (ROC) from 1949 to 1979. This was an association that began and ended with an American determination to distance itself from the government on Taiwan, in the interests of improved relations with the government of the People's Republic of China (PRC) on the mainland. In the intervening years, the United States and the ROC were aligned in a relationship—formalized by a mutual defense treaty from 1955 to 1979—which weathered two (almost three) military confrontations with the PRC.
  • Topic: Security
  • Political Geography: United States, China, America, Asia
  • Author: Douglas Paal
  • Publication Date: 07-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: As Americans consider their options for protecting and advancing their interests in Asia in the twenty-first century, it is natural that there will be wide-ranging views and vigorous debate. Recent events such as the 1996 Taiwan crisis, the Asian economic meltdown in 1997, and the exchange of state visits by presidents Bill Clinton and Jiang Zemin in 1997 and 1998 have intensified, then moderated and redirected, much of the debate over a very short span of time. Two years ago, for example, the Chinese were worrying aloud about American efforts to “encircle” China. Now they talk about “building a constructive strategic partnership with the U.S.” Despite these ups and downs, however, the fundamental choices for the United States have remained largely the same.
  • Topic: Security
  • Political Geography: United States, China, America, Taiwan, Asia
  • Author: Chu Shulong
  • Publication Date: 06-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The American security alliances with Japan and South Korea have been a major concern of China's foreign and defense policies. China's position toward the alliances is determined by its foreign policy and security theories, doctrines, and principles; by its approach to a regional security mechanism in the Asia-Pacific region; by its bilateral relations with countries in Northeast Asia; and by incidental issues such as territorial disputes in Asia in which it is involved.
  • Topic: Security
  • Political Geography: United States, Japan, China, Asia, Korea
  • Author: Lawrence J. Lau, K.C. Fung
  • Publication Date: 04-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The United States and China have vastly different official estimates of the bilateral trade imbalance. The U.S. figures show that the United States had a merchandise trade deficit of US$57 billion vis-à-vis China in 1998 whereas the Chinese figures show that China had a merchandise trade surplus of only US$21 billion vis-à-vis the United States. There is a difference of US$36 billion. Which set of figures is right?
  • Topic: International Trade and Finance
  • Political Geography: United States, China, Asia
  • Author: Michael J. Green
  • Publication Date: 03-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: This monograph explores contemporary Japan-ROK security relations from the perspective of U.S. strategic interests in Asia. Japan and the Republic of Korea have been aligned but not allied since the beginning of the Cold War, and the United States has long been frustrated in its desire to strengthen the Japan-ROK leg of its network of bilateral alliances in Asia. The United States abandoned the goal of encouraging a formal U.S.-Japan-ROK alliance early on in the Cold War, and in the current strategic environment a trilateral alliance would probably be counterproductive. At the same time, however, the fluidity of East Asian security relations today has heightened the dangers of leaving the Japan-ROK security relationship in an ambiguous state. Closer Japan-ROK security cooperation will enhance U.S. efforts to maintain forward presence, manage diplomacy and potential crises on the Korean Peninsula, and integrate China as a cooperative partner in the region. In contrast, distant Japan-ROK relations would complicate all of these U.S. objectives. Hostile Japan-ROK relations, particularly in the context of Korean reunification, would have a spillover effect on Sino-U.S. relations and could return the region to the great-power rivalry of the last century.
  • Topic: Security
  • Political Geography: United States, Japan, China, Asia, Korea
  • Author: Jae Ho Chung
  • Publication Date: 02-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Does history repeat itself? It appears so for Korea as an unfortunate geopolitical pawn of its stronger neighbors for the last century or so. History does not seem to repeat in quite the same way, however. As Chinese diplomat Huang Zunxian recommended in 1880 that Chosun (Korea's official designation during the Yi Dynasty) “side with the Qing” ( qinzhong ) while relegating the relative importance of Japan and the United States to the levels of “aligning and connecting” ( jieri and lianmei ), respectively, Korea remained for the most part the most loyal subsystem of the Sinic world order, thereby missing out on opportunities for self-strengthening and realignment and eventually becoming a Japanese colony. More than a hundred years later, the Republic of Korea (hereafter Korea) may now be about to confront a similar dilemma, but this time with a reversed order of preferences. That is to say, the rise of China, with which Korea has already accomplished diplomatic normalization, may gradually force the Seoul government to reconfigure its Cold War–based strategic thinking and reassess its half-century alliance relationship with the United States.
  • Topic: Security
  • Political Geography: United States, China, Asia, Korea
  • Author: Andrew Scobell
  • Publication Date: 01-1999
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China conducted a series of military exercises and missile tests in the vicinity of the Taiwan Strait between July 1995 and March 1996. On July 18, 1995, Beijing announced that missile tests would be conducted targeting an area some 90 miles off the coast of northern Taiwan. Then, on three consecutive days, July 21, 22, and 23, a total of six DF-15 missiles were launched from sites in Fujian province—two per day. The following month, after a five-day advance warning, PLA naval vessels and aircraft conducted ten days of live-fire tests off the coast of Fujian. Further military exercises were conducted in mid-November to the south of the Strait, including joint operations involving air, land, and naval arms of the PLA. On March 5, 1996, Beijing announced it would soon begin another round of missile tests. This time they were to be targeted at seas less than fifty miles from Taiwan's busiest ports. On March 8, three DF-15 missiles were fired from bases in Fujian. Five days later, another DF-15 missile was launched. Finally, also after advanced warning, live-fire tests and war games were conducted off the coast of Fujian to the north of the Strait and to the south of the Strait between March 12 and March 25. The maneuvers included amphibious landing exercises and aerial bombing. Some forty naval vessels, two hundred and sixty aircraft, and an estimated 150,000 troops participated.
  • Topic: Security
  • Political Geography: United States, China, Taiwan, Beijing, Asia
  • Author: C.H. Kwan
  • Publication Date: 12-1998
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The currency crisis that started in Thailand in the summer of 1997 was followed by repercussions on the currencies of neighboring countries, culminating in a crisis infecting most countries in East Asia. Japan and China, which have developed strong ties with the rest of Asia through trade and investment, have not been exempted from this contagion. This paper looks at the latest currency crisis in Asia from the perspectives of these two regional giants.
  • Topic: Economics, International Trade and Finance
  • Political Geography: Japan, China, Israel, East Asia, Asia, Thailand
  • Author: Hideo Sato
  • Publication Date: 09-1998
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: The People's Republic of China is now a major economic and military actor in the international relations of the Asia Pacific region, and thus we cannot afford to ignore China in reviewing the U.S.-Japan alliance. The Chinese economy has been growing rapidly over the past decade and a half, at an annual rate of about 10 percent, and it is expected to sustain a similar pattern of growth for the foreseeable future. Beijing's defense spending has also been increasing every year at a double-digit level for some time. Consequently, China's domestic and foreign policies will from now on significantly influence the course of international relations in this region, and perhaps elsewhere as well.
  • Topic: Security
  • Political Geography: United States, China, Beijing, Asia
  • Author: David Shambaugh
  • Publication Date: 06-1998
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: It is a pleasure to be here at Stanford to discuss China's new military leadership, and to share some preliminary findings from my research on the People's Liberation Army (PLA). One key feature of the new leadership in China today, following the passing of patriarch Deng Xiaoping, are the new faces to be found in the military. The PLA High Command today (see Appendix) is almost entirely new. There has been almost total turnover of the top twenty to thirty military officers in China during the last three years. This includes all the commanders, deputy commanders, and political commissars in all seven military region commands; the General Staff, Logistics, and Political Departments; the two major educational institutions of the PLA, the National Defense University and the Academy of Military Sciences; the Commission on Science, Technology and Industry for National Defense and its successor body the general Armaments Department, and other bodies. The Central Military Commission itself has seen more than half of its membership turn over in the last few years. Only the top echelon of the Second Artillery, China's ballistic missile forces, has gone relatively untouched. I anticipate much more personnel turnover and organizational reform in the next few years as the PLA proceeds with its policy of downsizing, upgrading, and streamlining its force structure.
  • Topic: Security, Defense Policy
  • Political Geography: China, Asia
  • Author: Michel Oksenberg, Elizabeth Economy
  • Publication Date: 02-1998
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China's performance in numerous environmental areas—emission of greenhouse gases, use of ozone-depleting substances, reduction of sulphur dioxide emissions, or exploitation of fishing grounds in the western Pacific—will help determine the success of various global and regional environmental protection efforts. And as the World Bank's recent study Clear Water, Blue Skies: China's Environment in the New Century documents, the quality of life within China will be greatly affected by efforts to protect air, water, and soil, all of which are under heavy assault.
  • Topic: Environment, International Cooperation
  • Political Geography: China, Asia
  • Author: Wu Xinbo
  • Publication Date: 02-1998
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China is perhaps the most important variable in East Asian security, not only because of its growing power but also because of the great uncertainty over its future. Therefore, to assess China's impact on regional security, one question should be tackled first: what will China look like in the future? There are three different schools of thought concerning China's future: the “implosion" school holds that China, unable to cope with a wide array of social, economic, and political challenges created by its rapid economic growth, will follow in the footsteps of the former Soviet Union and “implode" the “expansion" school argues that as China gradually builds up its material strength, Beijing will wield its weight and seek to establish hegemony in the region; and the “integration" school believes that as China's economy further merges with the world economy, Beijing's internal and external behaviors will slowly but inevitably conform to international norms, and China will become a more responsible and more cooperative member of the world community.
  • Topic: International Relations, Security, Defense Policy
  • Political Geography: China, Israel, Beijing, East Asia, Asia, Soviet Union
  • Author: K.C. Fung, Lawrence Lau
  • Publication Date: 05-1997
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China's presence in the world economy continues to grow and deepen. The foreign sector of China plays an important and multifaceted role in the country's economic development. At the same time, China's expanded role in the world economy is beneficial to all its trading partners. Regions that trade with China benefit from cheaper and more varied imported consumer goods, raw materials, and intermediate products. China also provides a large and growing export market. While the entry of any major trading nation in the global trading system can create a process of adjustment, the outcome is fundamentally a win-win situation. It is a simple but powerful lesson from economics that freer international trade and investments benefit all parties concerned.
  • Topic: International Relations, International Political Economy, International Trade and Finance
  • Political Geography: China, Asia
  • Author: K.C. Fung, Lawrence Lau
  • Publication Date: 04-1996
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: There are huge discrepancies between the official Chinese and U.S. estimates of the bilateral trade balance. The discrepancies are caused by different treatments accorded to re-exports through Hong Kong, re-export markups, and trade in services. Deficit-shifting between China, on the one hand, and Hong Kong and Taiwan, on the other, due to direct investment in China from Taiwan and Hong Kong, is partly responsible for the growth in the China United States bilateral trade deficit.
  • Topic: International Political Economy, International Trade and Finance
  • Political Geography: United States, China, Taiwan, Asia, Hong Kong
  • Author: Donald Emmerson, Henry Rowen, Michel Oksenberg, Daniel Okimoto, James Raphael, Thomas Rohlen, Michael H. Armacost
  • Publication Date: 01-1996
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: Since the end of the Cold War, the power and prestige of the United States in East Asia have suffered a worrisome degree of erosion. The erosion is, in part, the by-product of long-run secular trends, such as structural shifts in the balance of power caused by the pacesetting growth of East Asian economies. But the decline has been aggravated by shortcomings in U.S. policy toward East Asia, particularly the lack of a coherent strategy and a clear-cut set of policy priorities for the post-Cold War environment. If these shortcomings are not corrected, the United States runs the risk of being marginalized in East Asia--precisely at a time when our stakes in the region are as essential as those in any area of the world. What is needed, above all, is a sound, consistent, and publicly articulated strategy, one which holds forth the prospect of serving as the basis for a sustainable, nonpartisan domestic consensus. The elements of an emerging national consensus can be identified as follows:
  • Topic: International Relations, Security, Foreign Policy, Economics
  • Political Geography: United States, China, Israel, East Asia, Asia