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1. The Cross-Border Interbank Payment System: A Case Study in Chinese Economic Leadership

Author:
Aidan Campbell
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Investigations seeking to explain the rise of China rarely investigate the many new institutions founded to increase China’s economic success and influence over global affairs. In the economic sector, some better-known projects include the Belt and Road Initiative, the Asian Infrastructure Investment Bank, and the New Development Bank. One of the newest and least understood institutions founded to promote international use of the RMB is the Cross-Border Interbank Payment System (CIPS). The purpose of this research is to examine the development, policies, and goals of CIPS in order to better understand the phenomenon of Chinese-lead international economic institutions. Novel evidence for CIPS’s intention to adopt blockchain technology and provide services for currencies other than the RMB is presented. The conclusion to this research is that CIPS is presently too small to pose a threat to the existing SWIFT network or predominance of US dollar transactions in international trade. At the same time, CIPS evidences a patient and rational strategy designed to reform international norms and patterns of trade to China’s advantage in the long term.
Topic:
Political Economy, Leadership, Economy, Belt and Road Initiative (BRI), and Banking
Political Geography:
China and Asia

2. State Capitalism, Imperialism, and China: Bringing History Back In

Author:
Isabella Weber
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
State capitalism is experiencing a great revival as a term to capture the current capitalist constellations, increasingly replacing neoliberalism. Unlike neoliberalism, however, the term state capitalism has a long history reaching back to the age of imperialism in the late 19th century. While state capitalism has been used as a pejorative term by Marxists, liberals and neoliberals alike, it has served as a programmatic label for developmentalist and neomercantilist projects in reaction to imperialism in the periphery. This paper argues that we need to bring the intellectual history of state capitalism into the ‘new state capitalism’ debate. China has played a major role in the revival of state capitalism in the social sciences, but the long history of China’s engagement with state capitalism as a concept and program dating back to the late Qing reformers has been overlooked for the most part. State capitalism is by no means new to China, from Liang Qichao, Sun Yatsen and Mao Zedong to Deng Xiaoping, the idea that China had to create a modern nation state and industrial capitalism in the name of economic progress and to get ahead in the global competition is a recurring theme. What is new is that for the first time the ambition to use state capitalism as a means to catch up with the West is bearing fruits in ways that could undermine the predominance of Western economies.
Topic:
Imperialism, Political Economy, History, Capitalism, and State Capitalism
Political Geography:
China and Asia

3. China's Political-Economy, Foreign and Security Policy: 2023

Author:
Center for China Analysis
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Asia Society
Abstract:
It has now been three months since the 20th Party Congress convened in Beijing on October 15. While the Congress set Xi Jinping’s ideological, strategic, and economic direction for the next five years, much has happened since then that the Chinese leadership did not anticipate. Principal among these surprises was the spontaneous eruption in late November of public protests across multiple Chinese cities against the economic and social impact of the Chinese Communist Party’s “dynamic zero-COVID” policy. These protests resulted in an unprecedented U-turn on December 8 from China’s relentless pursuit of its three-year-long national pandemic containment strategy to the Party now seeking desperately to restore economic growth and social calm. This shift has in turn generated major public pressures on the Chinese health system as hospitals struggle to cope with surging caseloads and mortalities. All of these developments stand in stark contrast to the political, ideological, and nationalist self-confidence on display at the 20th Party Congress. In October, Xi Jinping swept the board by removing any would-be opponents from the Politburo and replacing them with long-standing personal loyalists. Xi also proclaimed China’s total victory over COVID-19, contrasting the Party’s success with the disarray its propaganda apparatus had depicted across the United States and the collective West. Despite faltering economic growth, Xi had doubled down in his embrace of a new, more Marxist approach to economic policy which prioritized planning over the market, national self-sufficiency over global economic integration, the centrality of the public sector over private enterprise, and a new approach to wealth distribution under the rubric of the Common Prosperity doctrine. At the same time, Xi’s 2022 Work Report, delivered at the Congress, abandoned Deng Xiaoping’s long-standing foreign policy framework that “peace and development are the principal themes of the time” and instead warned of growing strategic threats and the need for the military to be prepared for war. As part of a continuing series on China’s evolving political economy and foreign policy, this paper’s purpose is threefold: to examine the political and economic implications of this dramatic change in China’s COVID-19 strategy; to analyze what, if any, impact it may have on China’s current international posture; and to assess whether this represents a significant departure from the Party’s strategic direction set at the 20th Party Congress last October. The paper concludes that the Party changed course on COVID-19 for two reasons: (1) it feared that not doing so would threaten its unofficial social contract with the Chinese people based on long-term improvements in jobs and living standards; and (2) that a structural slowdown in growth could also undermine China’s long-term strategic competition against the United States. This paper also concludes that the stark nature of the December 8 policy backflip, together with the Chinese health system’s lack of preparedness for it, has dented Xi Jinping’s political armor for the medium term. This setback comes on top of internal criticism of Xi’s broader ideological assault on the Deng-Jiang-Hu historical economic growth formula that Xi has prosecuted since 2017, as well as Xi’s departure from Deng’s less confrontational foreign policy posture that characterized previous decades. Nonetheless, these policy errors remain manageable within Chinese elite politics, where Xi still controls the hard levers of power. Furthermore, many of these changes on both the economy and external policy are more likely to be short-to-medium term and therefore tactical in nature, rather than representing a strategic departure from the deep ideological direction laid out for the long-term in Xi’s October 2022 Work Report. While these changes to current economic and foreign policy settings are significant in their own right, there is no evidence to date that Xi Jinping’s ideological fundamentals have changed.
Topic:
Security, Foreign Policy, Political Economy, and COVID-19
Political Geography:
China and Asia

4. Xi Jinping’s Vision for the Middle East

Author:
Yair Albeck
Publication Date:
07-2023
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
Chinese leader Xi Jinping clearly aspires to establish a new global economic order centered around Beijing, not Washington. However, a new global economic order cannot be built in a day. The immensity of this challenge has forced Xi to set his sights on a set of interim goals. These include cementing the Communist Party’s control of the Chinese economy and shielding supply chains, capital flows, and strategic bilateral and multilateral relationships from hostile American policies. These goals equate to the creation of a Sinocentric global economic subsystem. This would be partially integrated into the current Western-led system but would be sufficiently decoupled from the West to protect the pillars of the Chinese Communist Party’s political economy. In Beijing’s grand design, the Middle East plays an indispensable role. But Western analysts have often misjudged China’s interests in the region as purely commercial. While Xi values the region for its economic potential, he sees it as one of the most important arenas of competition with the United States. Yet when United States National Security Advisor Jake Sullivan recently discussed American leadership of the global economy, he focused on Europe and the Indo-Pacific and mentioned Africa and Latin America. He did not mention the Middle East once.1 Washington’s persistent blind spot in the Middle East has obscured its view of Beijing’s global ambitions. If the US does not rectify this mistake, it risks losing more influence in the region and aiding China’s effort to supplant the US atop the global economic order.
Topic:
Foreign Policy, National Security, Political Economy, Foreign Direct Investment, and Xi Jinping
Political Geography:
China and Middle East

5. The Internationalisation of the Chinese Renminbi and China’s Digital Currency Plans

Author:
Lorenzo Bencivelli and Michele Savini Zangrandi
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
China has made major reforms to boost the international standing of its currency. The global presence of the renminbi remains contained, however. This is due to China’s economic structure (a persistent current account surplus and a partially closed financial account) and the government’s grip on the economy. China is also a Central Bank Digital Currency (CBDC) forerunner. The digital yuan (e-cny) is already active in a large scale trial. Many claim that the e-cny could provide a major boost to the internationalisation of the renminbi. However, the internationalisation of the renminbi would require major economic reforms that cannot be bypassed by the deployment of new technologies. The e-cny is therefore unlikely to boost the renminbi’s international presence. Yet, its underlying technology could be exported to other countries wishing to deploy their own-currency CBDCs. Much like with telecommunication equipment, this scenario would put China in the position of being a provider of a critical infrastructure. In the longer run, the export of e-cny technology might also facilitate the creation alternative payment networks, though this scenario is not very likely.
Topic:
Political Economy, Governance, Finance, Currency, and Digital Policy
Political Geography:
China and Asia

6. China’s Changing COVID-19 Policies: Market and Public Health

Author:
Zhun Xu
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
After the outbreak of COVID-19 in early 2020, China took fast and decisive measures to successfully contain the spread of the virus within its borders. While the rest of the world saw huge human and social costs in the pandemic, the Chinese mainland for about two years was largely free from COVID. The zero-COVID model, however, met great challenges by early 2022. Despite some efforts to save the zero-COVID model, in November 2022, the Chinese government abruptly abandoned its signature COVID controls during the pandemic and switched to the opposite. This article reviews the evolution of the Chinese COVID policies and places the dramatic turns in the context of the changing Chinese political economy. The findings show that the shifting class interests and actions were an important force behind China’s retreat from zero- COVID.
Topic:
Markets, Political Economy, Public Health, and COVID-19
Political Geography:
China and Asia

7. Policy Experimentation in China: The Political Economy of Policy Learning

Author:
Shaoda Wang and David Y. Yang
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
Determining what policies to implement and how to implement them is an essential government task. Policy learning is challenging, as policy effectiveness often hinges on the nature of the policy, its implementation, the degree that it is tailored to local conditions, and the efforts and incentives of local politicians to make the policy work.
Topic:
Political Economy, Politics, Policy Implementation, and Economic Policy
Political Geography:
China and Asia

8. Public responses to foreign protectionism: Evidence from the US-China trade war

Author:
David Steinberg and Yeling Tan
Publication Date:
06-2022
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
America's recent turn toward protectionism has raised concerns about the future viability of the liberal international trading system. This study examines how and why public attitudes toward international trade change when one's country is targeted by protectionist measures from abroad. To address this question, the authors fielded three original survey experiments in the country most affected by US protectionism: China. First, they find consistent evidence that US protectionism reduces Chinese citizens' support for trade. This finding is replicated in parallel experiments on technology cooperation, and further validated outside of the China context with a survey experiment in Argentina. Second, they show that responses to US protectionism reflect both a "direct reciprocity" logic—citizens want to retaliate against the United States specifically—and a "generalized reciprocity" logic that reduces support for trade on a broader, systemic basis.
Topic:
Economics, Political Economy, Public Opinion, Trade, and Protectionism
Political Geography:
China, Asia, North America, and United States of America

9. China's Belt and Road Initiative in Italy: An Analysis of Financial Cooperation

Author:
Nicola Bilotta
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Financial cooperation is essential to boosting bilateral economic ties, providing firms with more effective instruments to operate in foreign markets. It should come as no surprise, then, that financial cooperation was a pillar of the 2019 Memorandum of Understanding (MoU) reached between Italy and China in support of the latter’s Belt and Road Initiative (BRI). However, a preliminary analysis of BRI-related commercial agreements between Italian financial institutions and their Chinese counterparts shows that they have not resulted in any ground-breaking development. These Memoranda have apparently just added a “BRI” badge to pre-existing trends of collaboration. The BRI-related MoUs in the field of financial cooperation do not, for the time being at least, justify concerns that China may gain an economic foothold in Italy large enough to win it much political influence. A more realistic risk is that these MoUs may undermine a common European approach to China, weakening the negotiating stance of the European Union’s. Paper prepared in the framework of the IAI project “When Italy embraces the BRI”.
Topic:
Foreign Policy, Political Economy, Governance, Finance, and Belt and Road Initiative (BRI)
Political Geography:
China, Europe, Asia, and Italy

10. CBDCs for Dummies: Everything You Need to Know about Central Bank Digital Currency (And Why You Shouldn’t Be Afraid of It)

Author:
Nicola Bilotta
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
“No cash accepted in this store”. What might seem to some like science fiction is on its way to becoming reality. The rise of non-cash payments is a global phenomenon, although moving at different speeds around the world. To keep up with the digitalisation of payments (and of the economy), many central banks are exploring the development of Central Bank Digital Currencies (CBDCs), a digital form of cash. Despite being confined to a technical discussion among experts, when (rather than if) launched, CBDCs concerns us all. Thus, raising awareness of what CBDCs are, and of their key economic and political dimensions, is crucial to ensure that citizens are not only passive spectators. This paper has the ambition to provide (non-expert) readers with straightforward and simple answers to some of the many questions they may have around CBDCs. It sets the ground to better understand what CBDCs are (and are not), their drivers and their possible design. It will explore the impact of CBDC systems on privacy, the geo-strategic drivers of CBDCs and the possible rivalry between public and private money. Paper prepared in the framework of a research effort on the risks and the opportunities related to Central Bank Digital Currencies (CBDCs) with the support of Intesa Sanpaolo and the Bank of Italy.
Topic:
Political Economy, Governance, European Union, Finance, Currency, and Digital Policy
Political Geography:
China, Europe, and United States of America

11. An International Digital Yuan: (Vane) Ambitions, (Excessive) Alarmism and (Pragmatic) Expectations

Author:
Nicola Bilotta
Publication Date:
07-2021
Content Type:
Commentary and Analysis
Institution:
Istituto Affari Internazionali
Abstract:
Days after the European Central Bank (ECB) publicly disclosed its roadmap for a digital euro project on 24 July, the People’s Bank of China (PBoC) published a white paper describing the advancements of its plan for a digital yuan (e-CNY). While the EU roadmap outlines an investigation phase which will end in five years, China has already introduced several pilot experiments for its e-CNY. In June 2021, the e-CNY was employed in more than 70.7 million transactions for a value of 34.5 billion yuan by 20.8 million retail users and 3.5 million corporate users.
Topic:
International Political Economy, Political Economy, Governance, Finance, Currency, and Digital Policy
Political Geography:
China and Asia

12. Predicting Chinese State-Owned Enterprise Policy Incidence

Author:
Sara Hsu
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
In this exploratory research, we examine the effect of economic and noneconomic indicators on the creation of Chinese state-owned enterprise policies. Using a VAR model, we find indicators that explain state-owned enterprise policy creation variance, which means that we can explain, to some extent, the incidence of state-owned enterprise policies. This reduces economic policy uncertainty, thereby having the potential to increase economic activity and reduce costs.
Topic:
Political Economy, Economy, and State-Owned Enterprises
Political Geography:
China and Asia

13. Predicting Chinese Banking Policy Incidence

Author:
Sara Hsu
Publication Date:
07-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
In this exploratory research, we examine the effect of economic and noneconomic indicators on the creation of Chinese Banking and Insurance Regulatory Commission policies using a VAR model. We find that CBIRC policies are predicted by State Council construction policies and policies set by the State Administration of Foreign Exchange. This indicates that the CBIRC is inward-looking, observing what other regulators are doing rather than responding to changes in the real and financial economy. This may be a product of market distortions due to China’s unique blend of state-oriented and market-based institutions.
Topic:
Political Economy, Regulation, and Banking
Political Geography:
China and Asia

14. China’s grand industrial strategy and what it means for Europe

Author:
Frederico Mollet
Publication Date:
04-2021
Content Type:
Policy Brief
Institution:
European Policy Centre (EPC)
Abstract:
In its 14th Five-Year Plan, China has mapped out a grand economic and industrial strategy that upends many of the assumptions that underpin the EU's approach - how can the Union respond? With this new plan, the EU can expect tougher competition and greater protectionism in its economic relations with China. A further blurring of the public-private sector distinction in the country's economic model will make it harder to combat unfair Chinese competition. And while China is actively courting foreign investment, it is also signalling greater protectionism to products not made in China, which will lead to European investors' and exporters' interests diverging. To balance the scales, the EU should adapt its own strategy by: continuing to develop trade instruments to combat unfair competition at home and abroad; ensuring that these instruments and institutions can respond to unfair competition from private companies benefiting from state capital investment; ensuring that the extensive and often opaque government holdings in private firms are reflected in foreign direct investment and export controls; incorporating China's attempts to reconfigure supply chains into its own assessment of strategic dependencies, identifying areas that could become vulnerable; prioritising the improvement of access to the Chinese market for goods and services produced in Europe; developing alternative sources of growth, and boost demand and reduce barriers within the Single Market to offset greater Chinese protectionism; and ensuring that its industrial policy efforts will enable European industry to match China's developments. The present moment may mark a turning point in EU–China relations: in a little over three months, an agreement on an investment treaty was followed by sanctions and countersanctions. Geopolitical conflict ratchets up between China and the US. Beijing's new economic course will reshape its global relationships. China's protectionist turn and growing one-sided dependencies will threaten Europe's long-term strategic autonomy and undercut any attempts to construct a balanced approach to EU–China relations. If the EU's multi-track strategy is to work, a concerted effort is required to preserve economic parity and balance between the two powers.
Topic:
International Relations, Political Economy, European Union, Grand Strategy, Industry, and Supply Chains
Political Geography:
China, Europe, and Asia

15. Potential Reserve Army and Diverging Paths of Transition in Former State Socialist Economies

Author:
Zhun Xu
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Since the rise of neoliberalism in the world in the last quarter of the 20th century, many former state socialist economies also started their transition into different kinds of market economic models. Over the course of the last three decades or so, there emerged distinct paths of transition among these economies. This paper proposes a Marxian framework to help understand the three major models of transitions among former socialist economies: the Russian path, the Chinese path, and the Cuban/North Korean path. The framework focuses on the differences in working class composition and in particular the size of the potential reserve army in these socialist economies. An examination of the historical process of market reforms in former state socialist economies suggests that a sizable potential reserve army could give rise to a gradual approach to neoliberal transition while a negligible potential reserve army could lead to either a shock therapy or a long impasse.
Topic:
Political Economy, Neoliberalism, Socialism, and Market Economy
Political Geography:
Russia, China, North Korea, and Cuba

16. The State's Response to the Crisis of Neoliberalism: A Comparison of the Net Social Wage in China and the United States, 1992-2017

Author:
Katherine Moos and Hao Qi
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
We compare the welfare states and taxation regimes of the two largest economies in the world, China and the United States, from 1992 to 2017. We begin with a comparison of each country’s net social wage—that is, the difference between total benefits received by and taxes paid by labor—using two established methods. While the net social wage in the two countries exhibited similar trends, the increasing net social wage has distinctly different implications in the two countries due to their specific historical trajectories in the neoliberal era. In the US, the increasing net social wage reflects an ambivalent and reluctant response to workers’ social reproduction. In China, it reflects institutional changes in the welfare state, which we interpret as the Chinese state’s attempt to resolve the social-reproduction crisis caused by neoliberal reforms of the 1990s.
Topic:
Political Economy, Economy, Neoliberalism, Crisis Management, and Welfare
Political Geography:
China and United States of America

17. China, India and the political economy of medical supplies

Author:
Stein Sundstol Eriksen
Publication Date:
04-2020
Content Type:
Special Report
Institution:
Norwegian Institute of International Affairs
Abstract:
Summary: • The pandemic and lockdowns threaten the supply of medicines, especially from India • Poor countries relying on supplies of cheap Indian medicines are especially vulnerable • New medicines and vaccines are likely to be developed and patented by Western companies and will be expensive. • Norway should help fund the supply of medicines and promote reforms of patent rules to make medicines more affordable
Topic:
Political Economy, Asia, Vaccine, Pandemic, and COVID-19
Political Geography:
China, South Asia, India, and Asia

18. The Impact of Intranational Trade Barriers on Exports: Evidence from a Nationwide VAT Rebate Reform in China

Author:
Jie Bai and Jiahua Liu
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
It is well known that various forms of non-tariff trade barriers exist within a country. Empirically, it is difficult to measure these barriers as they can take many forms. We take advantage of a nationwide VAT rebate policy reform in China as a natural experiment to identify the existence of these intranational barriers due to local protectionism and study the impact on exports and exporting firms. As a result of shifting tax rebate burden, the reform leads to a greater incentive of the provincial governments to block the domestic flow of non-local goods to local export intermediaries. We develop an open-economy heterogenous firm model that incorporates multiple domestic regions and multiple exporting technologies, including the intermediary sector. Consistent with the model’s predictions, we find that rising local protectionism leads to a reduction in interprovincial trade, more “inward-looking” sourcing behavior of local intermediaries, and a reduction in manufacturing exports. Analysis using micro firm-level data further shows that private companies with greater baseline reliance on export intermediaries are more adversely affected.
Topic:
International Trade and Finance, Political Economy, Reform, and Tariffs
Political Geography:
China and Asia

19. From the EMS to the EMU and...to China

Author:
Joseph Halevi
Publication Date:
11-2019
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
The paper highlights the position of German authorities, showing that they were quite lucid about the fundamental weaknesses inherent in a process that separated monetary from fiscal policies by giving priority to the centralization of the former. Instead of repeating the well known critiques levelled against the EMU – for which readers are referred to the unsurpassed treatment by Stiglitz, the essay highlights the splintering of Europe in the way in which it has unfolded during the 1990s and in the first decade of the present millennium. In particular the early economic and political origins of the terminal crisis of Italy are located between the late 1980s and the 1990s. France is shown to belong increasingly to the so-called European periphery by virtue of a weakening industrial structure and persistent balance of payments deficits. The paper argues that France regains its central role by political means and through its weight as an active nuclear military power centered on maintaining its imperial interests and posture especially in Africa. The first decade of the present millennium is portrayed as the period in which a distinct German economic area had been formed in the midst of Europe with a strong drive to the east with an increasingly powerful gravitational pull towards the People’s Republic of China.
Topic:
Economics, International Political Economy, Political Economy, History, and Macroeconomics
Political Geography:
Africa, China, Europe, Asia, Germany, and Global Focus

20. China and the World Bank: How Contrasting Development Approaches affect the Stability of African States

Author:
Kai Gehring, Lennart C. Kaplan, and Melvin H.L. Wong
Publication Date:
10-2019
Content Type:
Working Paper
Institution:
Empirical Studies of Conflict Project (ESOC)
Abstract:
China’s development model challenges the approaches of traditional Western donors like the World Bank. We argue that both aim at stability, but differ in the norms propagated to achieve that. Using fixed effects and IV estimations, we analyze a broad range of subnational stability measures in Africa. Aid by both the WB and China does not increase outright conflict nor any type of citizen protest, on average. Both even reduce outright conflict by governments against civilians. Still, Chinese aid is associated with more government repression and an increased acceptance of authoritarian norms, while WB projects strengthen democratic values.
Topic:
Development, International Political Economy, Political Economy, World Bank, and Developing World
Political Geography:
Africa and China

21. Social Stability and Resource Allocation within Business Groups

Author:
Haikun Zhu
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
Using datasets on transactions within business groups and social sentiment in China, I show that state-owned enterprises (SOEs) use internal funds to address social unrest, complying with the government’s political goals. I use plausibly unexpected shocks to regional stability to analyze the response of SOEs to these events. I find that the government, as the controlling shareholder, adopts a carrot-and-stick approach. The government offers a “carrot” by injecting funds into SOEs located in the affected areas, which are then used to generate benefits to the public, such as larger labor payments and additional capital expenditures. However, if there are severe political conflicts that threaten its authority, the government applies a “stick” by withdrawing resources. The SOEs channel seems effective because local sentiment recovers around shocks when SOEs offer more benefits. Additional tests show that the SOEs channel is significant in economic magnitude compared to fiscal redistribution. As a result of the transfer, SOEs lose value after shocks, but firms in the region improve their performance later. This paper provides new evidence on how the intra-group allocation of resources incorporates political objectives, and has socioeconomic impact.
Topic:
Economics, Political Economy, Business, Capital, and Social Stability
Political Geography:
China and Asia

22. A Deeper Look at China’s “Going Out” Policy

Author:
Hongying Wang
Publication Date:
03-2016
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation
Abstract:
In recent years, the world has seen rapid growth in China’s financial reach beyond its borders. Following the announcement of a “going out” strategy at the turn of the century, many Chinese enterprises have ventured to invest and operate abroad. After three decades as primarily a recipient of foreign direct investment (FDI), China has now emerged as a major FDI-originating country as well. Much of China’s foreign aid is closely entangled with its outgoing FDI, and it has also been rising. Since 2013, the Chinese government has been pushing for a new One Belt, One Road (OBOR) initiative, aiming to connect China with countries along the ancient Silk Road and a new Maritime Silk Road via infrastructure investment. In addition, since 2009, China has actively promoted the internationalization of its currency, the renminbi (RMB). There has been a great deal of anxiety about the motivations behind China’s going out policy and its possible international consequences. Many view it as an expression of China’s international ambition and a strategy that threatens the existing international order; however, that is not the whole story. An equally important but often less understood issue is the role of China’s domestic politics and political economy in shaping its new activism in foreign financial policy. Moreover, it is unclear how successful the going out policy is. The complexity of China’s going out policy was the topic for a recent round table discussion hosted by the Centre for International Governance Innovation and the Foreign Policy Institute at the School of Advanced International Studies of Johns Hopkins University in Washington, DC.[1] Participants discussed a number of issues around two broad themes: the impact of domestic political economy on China’s foreign economic policy and the challenges for China’s external financial strategy — in particular, its OBOR initiative.
Topic:
Markets, Political Economy, Monetary Policy, Infrastructure, Foreign Direct Investment, and Financial Markets
Political Geography:
China

23. Beyond Manufacturing: Developing the Service Sector to Drive Growth in the PRC

Author:
Wei Wang, Gemma Estrada, Jurgen Conrad, Sang-Hyop Lee, and Donghyun Park
Publication Date:
05-2016
Content Type:
Policy Brief
Institution:
East-West Center
Abstract:
As demand from global markets declines, slowing exports of manufactured goods from the People's Republic of China means the country must increasingly rely on domestic markets for growth. Unlike manufactured goods, services—those "intangible" products that include everything from transportation to scientific research to real estate services—are geared more toward domestic markets. Services, then, will be key to the rebalancing process. However, while the service sector has grown rapidly in the PRC, it continues to lag behind other countries at similar stages of development. In addition, the sector is dominated by traditional low-end types of services, rather than knowledge-intensive services. Heavy regulatory burdens, barriers to trade in services, and an unfavorable policy environment have been major obstacles to upgrading the sector and improving its competitiveness. Policy reform should focus on strengthening competition to raise productivity, with the goal of increasing not only the number of jobs and contribution to GDP, but also of positioning the service sector to compete internationally and spur export growth.
Topic:
International Trade and Finance, Markets, Political Economy, Reform, and GDP
Political Geography:
China

24. At the Crossroads: The TPP, AIIB, and Japan's Foreign Economic Strategy

Author:
Saori N. Katada
Publication Date:
05-2016
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
In 2015, two mega-initiatives took shape that will affect economic relations in the Asia-Pacific region: the US-promoted Trans-Pacific Partnership (TPP) trade agreement and the China-led Asian Infrastructure Investment Bank (AIIB). Although they address different needs, both are expected to have profound effects on Asia's economic governance in the near future, and will shape economic norms in the Asia Pacific and beyond. Japan has joined the TPP but stayed out of the AIIB, decisions that might seem counterintuitive considering its history of resisting trade liberalization and of promoting infrastructure investment. Is Japan simply favoring its US ally over rival China? Or is it that Japan's position on the TPP and AIIB aligns with its own economic priorities, and enhances its geo-economic advantage? With a US-China competition over economic ideas and regional strategies, Japan occupies a unique position that may allow it to influence the direction of Asia-Pacific economic governance, which is now being battled out by the two "titans."
Topic:
Economics, International Trade and Finance, Political Economy, and Treaties and Agreements
Political Geography:
China and Asia

25. Chinese Economic Challenges to the World Trade Organization: Separating Myth from Reality

Author:
Umbreen Javaid and Muhammad Sharreh Qazi
Publication Date:
01-2016
Content Type:
Journal Article
Journal:
South Asian Studies
Institution:
Department of Political Science, University of the Punjab
Abstract:
China has taken the world with a different angle; an angle that kept China mostly behind its conservative mercantilist restrictions and access to foreign investors largely remained actively initiated. Even though China was admitted to the World Trade Organization (WTO) in 2001, and remained an observer to the General Agreement to Tariff and Trade (GATT), cost of receiving membership meant extreme modifications to Chinese system of economy. Modifications that required China to allow access and tariff concessions to global community and demanded Chinese nationalist mercantilist designs to be affable to international standards. This however, never meant that China would stop expanding, or at least take a recess from its economic augmentation. WTO quickly saw China rise to a point where even though it remained compliant to international economic norms, it still remained a formidable rebel to set patterns, tacitly compelling WTO and other international economic forums to feel impractical, if not impotent. Chinese economic investments, together with its dominance on international relations, has often raised questions on its intentions into becoming a member of WTO. It is often miscalculated that China intends to implode WTO from within by introducing a change in the international economic system through sheer pressure or somehow, China is strategizing to manipulate WTO as a nascent member in order to introduce another form of global competition against members that are already in antagonism towards China.
Topic:
International Trade and Finance, Political Economy, World Trade Organization, and Soft Power
Political Geography:
Pakistan, China, South Asia, Asia, and Punjab

26. Signaling Legitimacy to Foreign Investors: Evidence from Chinese IPOs on U.S. Markets.

Author:
Xu Jin, Donald Patton, and Martin Kenney
Publication Date:
05-2015
Content Type:
Working Paper
Abstract:
From 1999-2010 120 Chinese emerging growth firms undertook initial public stock offerings on U.S. markets. This provided a remarkable natural experiment for exploring how this class of organizations from a radically different political economy established their legitimacy and how, once established, this legitimacy permitted organizational and personnel flexibility for later firms. The increased legitimacy allowed changes in the backgrounds of the members of the IPO top management team (TMT) and independent members of the board of directors (BoD). We find that overall composition of both the TMT and BoD in terms of experience in the U.S. decreased and “Chineseness” increased, but at different rates. For the operational TMT members, U.S. experience decreased dramatically over time, except for the CFO who is the representative of investors within the TMT. Similarly, on the BoD, the venture capitalists continued to have high levels of US experience, while the other independent members tracked the TMT in having less US experience. In this increased legitimacy allows the acceptance of “foreign” operational management, but investors are less lenient in terms of ensuring that their “monitors,” the CFO and venture capitalists, should show evidence, i.e., U.S. experience and background, that they adhere to the investor’s values.
Topic:
Economics, International Trade and Finance, Markets, and Political Economy
Political Geography:
China

27. Responding to Uncertainty: Syndication Partner Choice by Foreign Venture Capital Firms in China.

Author:
Xiao Huang, Martin Kenney, and Donald Patton
Publication Date:
03-2015
Content Type:
Working Paper
Abstract:
Cross-border venture capital investment has grown dramatically. Drawing upon observations about the liability of foreignness, previous research has shown that foreign venture capitalists (VCs) tend to partner with local VCs in order to offset information asymmetry and the liabilities of foreignness. Much of the literature has suggested that local VCs should help reduce operational uncertainty. This paper examines syndication partner choice in China, which today is likely the most uncertain environment in which foreign VCs operate on a large scale. This provides an ideal environment for understanding partner selection under uncertainty. Our results show that foreign investors are more likely to choose Chinese investors in later rounds and in more mature portfolio firms. While foreign firms with more Chinese experience are more likely to co-invest with Chinese VCs, the older foreign VC firms are less likely to do so. Remarkably, having a Chinese office made foreign VCs less likely to coinvest. In seed-stage investments, when uncertainty is the greatest, foreign firms are least likely to co-invest with Chinese VCs, and this was not affected by the maturation of the market, while at the later stage, when uncertainty is lowest, they are most likely to co-invest.
Topic:
Economics, International Trade and Finance, Markets, and Political Economy
Political Geography:
China

28. China’s Hidden Obstacles to Socioeconomic Rebalancing

Author:
Boy Lüthje and Christopher A. McNally
Publication Date:
10-2015
Content Type:
Policy Brief
Institution:
East-West Center
Abstract:
The global financial crisis of 2008-09 led to a policy consensus in China that its socioeconomic development model needed rebalancing. China's rapid development has been based on extensive growth reliant on exports, low wages, environmental exploitation, and the manufacturing of cheap products. China's current plans identify paths to economic rebalancing through intensive growth driven by rising investment in new technologies and manufacturing processes, improved wages and skills, and improved worker and environmental protections. Two industries, automotive and information technology, demonstrate the experience of and opportunities for rebalancing. Both offer improved employment conditions with better wages, but continue to incorporate large swaths of low-wage employment with little protection for workers' health and the environment. Economic rebalancing in China, therefore, has so far only appeared in pockets. Institutional safeguards for wages and labor standards remain constrained by powerful alliances among multinational corporations, Chinese state-owned/private enterprises, and the Chinese state.
Topic:
Economics, Political Economy, Labor Issues, and Financial Crisis
Political Geography:
China

29. Une puissance parmi d'autres : évolution des enjeux et défis géostratégiques de la France en Océanie (One Among Many: Changing Geostrategic Interests and Challenges for France in the South Pacific)

Author:
Denise Fisher
Publication Date:
12-2015
Content Type:
Special Report
Institution:
Centre d'Etudes et de Recherches Internationales
Abstract:
France, which is both an external and resident South Pacific power by virtue of its possessions there, pursues, or simply inherits, multiple strategic benefits. But the strategic context has changed in recent years. China's increased presence; consequent changes in the engagement of the US, Japan and Taiwan; and the involvement of other players in the global search for resources, means that France is one of many more with influence and interests in a region considered by some as a backwater. These shifts in a way heighten the value of France's strategic returns, while impacting on France's capacity to exert influence and pursue its own objectives in the region. At the same time, France is dealing with demands for greater autonomy and even independence from its two most valuable overseas possessions on which its influence is based, New Caledonia and French Polynesia. How it responds to these demands will directly shape the nature of its future regional presence, which is a strategic asset.
Topic:
Political Economy, Natural Resources, Colonialism, Political Science, and Decolonization
Political Geography:
Japan, China, Taiwan, France, Australia, Australia/Pacific, and United States of America

30. The China Threat: Memories, Myths, and Realities in the 1950s

Author:
Nancy Bernkopf Tucker
Publication Date:
06-2014
Content Type:
Book
Institution:
Columbia University Press
Abstract:
Nancy Bernkopf Tucker confronts the coldest period of the cold war--the moment in which personality, American political culture, public opinion, and high politics came together to define the Eisenhower Administration's policy toward China. A sophisticated, multidimensional account based on prodigious, cutting edge research, this volume convincingly portrays Eisenhower's private belief that close relations between the United States and the People's Republic of China were inevitable and that careful consideration of the PRC should constitute a critical part of American diplomacy. Tucker provocatively argues that the Eisenhower Administration's hostile rhetoric and tough actions toward China obscure the president's actual views. Behind the scenes, Eisenhower and his Secretary of State, John Foster Dulles, pursued a more nuanced approach, one better suited to China's specific challenges and the stabilization of the global community. Tucker deftly explores the contradictions between Eisenhower and his advisors' public and private positions. Her most powerful chapter centers on Eisenhower's recognition that rigid trade prohibitions would undermine the global postwar economic recovery and push China into a closer relationship with the Soviet Union. Ultimately, Tucker finds Eisenhower's strategic thinking on Europe and his fear of toxic, anticommunist domestic politics constrained his leadership, making a fundamental shift in U.S. policy toward China difficult if not impossible. Consequently, the president was unable to engage congress and the public effectively on China, ultimately failing to realize his own high standards as a leader.
Topic:
Foreign Policy, Diplomacy, Political Economy, and Bilateral Relations
Political Geography:
United States and China
Publication Identifier:
9780231159258
Publication Identifier Type:
ISBN

31. Avoiding the Blind Alley: China's Economic Overhaul and Its Global Implications

Author:
Daniel H. Rosen
Publication Date:
10-2014
Content Type:
Working Paper
Institution:
Atlantic Council
Abstract:
PRESIDENT XI JINPING ANNOUNCED a sweeping overhaul for China's economy in November 2013, with pledges to make market forces decisive, treat homegrown and foreign investors with the same laws and regulations, and change the mission statement of the government. The reform program, known as the Decisions plan and presented at the Communist Party leadership's Third Plenum meeting, is comprehensive and marks a turning point in China's modern history. The degree of boldness also indicates that after 35 years of world-beating economic performance, China's development model is obsolete and in need of urgent, not gradual, replacement. To justify the risks, President Xi quoted an impassioned plea for policy modernization by his predecessor Deng Xiaoping: the only way to avoid a dead end – a blind alley – is to deepen reform and opening both at home and with the world.
Topic:
Economics, International Trade and Finance, Political Economy, and Reform
Political Geography:
China

32. Virtuality, Perception and Reality in Myanmar's Democratic Reform

Author:
Victoria Christensen
Publication Date:
08-2013
Content Type:
Working Paper
Institution:
The Geneva Centre for Security Policy
Abstract:
Since the summer of 2011, the country of Myanmar has been experiencing rapid democratic reform. Headlines lauding these positive changes have become common-place in the international media. However, experts and academics who have been involved in the decade-long campaign to bring peace and democracy to Myanmar remain divided over how sincere these changes are. Some accuse the Government of carrying out “window-dressing” reforms to please the Western governments and enable the lifting of sanctions. They argue that the Government has a vested interest in maintaining the reins of power and that there is no incentive to make true democratic reforms. During a speech in Oslo in June 2012, Aung San Suu Kyi, the Myanmarese Pro-democracy leader described the recent reforms as positive but warned against blind faith in the process and pointed out the main challenges that remain unresolved – namely the ethnic issues and the ongoing imprisonment of political prisoners.
Topic:
Democratization, Human Rights, Political Economy, Governance, and Reform
Political Geography:
Geneva, United States, China, Tehran, Korea, and Southeast Asia

33. Informal Institutions in Autocracies: Analytical Perspectives and the Case of the Chinese Communist Party

Author:
Patrick Köllner
Publication Date:
08-2013
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Analyses of the shape and functioning of systems of political rule need to address informal institutions, which exist alongside and can relate to formal institutions in various ways. In this paper, I first discuss some analytical foundations of the study of such institutions. I then suggest that a focus on political regimes – understood as the configuration of formal and informal institutions shaping and reflecting the access to and the exercise of political power – can be particularly useful for analysing the shape and functioning of autocracies. Finally, I use such a regime focus to study the Chinese Communist Party and its leadership succession process, which is characterised by increasing institutionalisation and complementary as well as substitutive relations between formal and informal institutions.
Topic:
Communism, Political Economy, Political Theory, and Governance
Political Geography:
China and Israel

34. China's leadership: handover The changing of the guard

Publication Date:
10-2012
Content Type:
Working Paper
Institution:
Economist Intelligence Unit
Abstract:
On November 8th this year China will begin the once-a-decade process of changing its leaders, with the launch of the 18th National Congress of the Chinese Communist Party (CCP). This will, by coincidence, come just two days after the US presidential elections. Both events will have momentous repercussions, both for the countries involved and for the world, but they will mark a study in contrasts. Unlike the US, China's succession battles are being waged in near secrecy, yet observers are already sure who the next president and premier will be. Less clear is what exactly China's new leadership will stand for. This report will examine their backgrounds and policy positions, asking what we can expect from the incoming administration.
Topic:
Communism, International Trade and Finance, Political Economy, and Governance
Political Geography:
United States and China

35. Diverging Trajectories: Economic Rebalancing and Labor Policies in China

Author:
Boy Lüthje
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
The transformation of work and labor policies is one of the most underresearched aspects of China's political economy in recent decades. Western perceptions of Chinese workplaces are mostly informed by images of privatization and downsizing of traditional state-socialist enterprises, or by the unfamous sweatshops serving the production networks of global brandname companies under miserable conditions However, recent research reveals that labor politics in China have become highly diversified, in spite of the apparently centralized character of the political regime. At the same time, labor conflicts are on the rise across industries and regions.
Topic:
Industrial Policy, Political Economy, Labor Issues, and Sociology
Political Geography:
China

36. North Korean Succession and the Risks of Instability

Publication Date:
07-2012
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
Transitions often present risks to authoritarian regimes, but the succession in North Korea has apparently passed with few problems. With no opposition from the military and China's clear support, there are no signs to suggest that Kim Jŏng-ŭn, the young leader who replaced his father, Kim Jong-il, following his death in December 2011, is anything but in charge in his own right. Far from creating a regency of older family members or generals, the North Korean system has maintained its focus on a single leader and projected an image of stability and unity as it celebrates the centenary of the birth of its founder, Kim Il-sung. While that image appears to be accurate, there is nothing to suggest that the new leader is or will become inclined to take measures that would either improve the lot of the country's citizens or reduce the regional frictions that Pyongyang is at the centre of.
Topic:
Security, Cold War, Nuclear Weapons, and Political Economy
Political Geography:
China, Israel, and North Korea

37. Transforming the Philippines’ Defense Architecture: How to Create a Credible and Sustainable Maritime Deterrent

Author:
Felix Chang
Publication Date:
05-2012
Content Type:
Special Report
Institution:
Foreign Policy Research Institute
Abstract:
This paper argues that to adequately defend its maritime claims, the Philippines should consider an external defense architecture designed around mobile coastal defense batteries equipped with long-range anti-ship missiles and protected by an integrated air defense umbrella. Such an architecture would provide the Philippines with an effective means to not only counter surface combatants and improve the survivability of its own forces against naval aviation or ballistic missiles, but also do so with lower procurement, maintenance, and operational readiness costs than a traditional force would require. The Philippine government’s new capabilities-based defense budgeting process offers the country an opportunity to study and adopt this sort of defense architecture, which has become increasingly necessary as rising powers, such as China, have begun to test Philippine maritime sovereignty at places like Scarborough Shoal and the Spratly Islands.
Topic:
Defense Policy, Emerging Markets, Political Economy, Maritime Commerce, and Natural Resources
Political Geography:
China and Philippines

38. China's Soft Power in the Information Age: Think Again

Author:
Shanthi Kalathil
Publication Date:
05-2011
Content Type:
Working Paper
Institution:
Institute for the Study of Diplomacy, Edmund A. Walsh School of Foreign Service, Georgetown University
Abstract:
In recent years, many have argued that China has been largely successful at using soft power to bolster its rise to great power status. This essay suggests that the Chinese government—and other authoritarian states—have fundamentally misread the nature of the relationship between soft power and the globally networked, information-rich environment, thus misunderstanding how soft power is accumulated. Because of this, their efforts at deploying soft power over the long term are not likely to be as effective as conventional wisdom would make them out to be.
Topic:
Foreign Policy, Development, Diplomacy, Globalization, and Political Economy
Political Geography:
United States, China, and Israel

39. Global Energy Markets in a Time of Political Change

Author:
Bill White
Publication Date:
10-2011
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
A shift in relative energy consumption among regions and the development of new, unconventional supplies will be the most significant changes over the next twenty years. The dominant fuels in the world energy market until 2030 will continue to be hydrocarbons — oil, coal, and natural gas. Major shifts will occur, however, among the three fuels, among regions and in their supply. Globally, oil will continue to be the most widely used fuel as it supplies more than 90 percent of the energy for transportation. Coal, now the dominant fuel used for electric power generation, will lose ground to natural gas, a less carbon-intensive hydrocarbon. Natural gas will become the second largest overall supplier and well positioned to replace coal as the leading supplier for electric power. Developing countries will lead the way in overall energy growth, with Chinese and Indian energy demand growing fastest. Energy demand in developed countries will remain flat. For the United States, growth in gas shale and oil shale are likely to be “game changers,” altering the supply picture dramatically.
Topic:
Climate Change, Energy Policy, Environment, Markets, Political Economy, and Natural Resources
Political Geography:
United States, China, and India

40. Tradition in Chinese politics: The Party-state's reinvention of the past and the critical response from public intellectuals

Author:
Jyrki Kallio
Publication Date:
02-2011
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
This study discusses the role of history and tradition in the legitimization of the state in the People's Republic of China. In Chinese political debate, history has traditionally been the most important source of argumentation. Today, the Party-state is reinventing history and tradition to bolster its legitimacy, but the project has met with opposition. This study introduces and analyzes the related debate, ongoing among various actors in different public fora in China, and engaged in both by those affiliated with the Party-state and those outside the establishment.
Topic:
Economics, Government, Markets, Political Economy, and Politics
Political Geography:
China

41. Les entreprises françaises et allemandes en Chine : des pratiques de management contrastées dans un contexte en mutation

Author:
Jean-Louis Rocca, Rémi Bourguignon, Solène Hazouard, and Martine Le Boulaire
Publication Date:
09-2011
Content Type:
Special Report
Institution:
Centre d'Etudes et de Recherches Internationales
Abstract:
Ce rapport constitue le troisième volet1 d’une série d’études consacrées à l’implantation des entreprises occidentales en Chine, un pays qui représente un environnement des affaires atypique, entre exploit et danger. Son rythme de croissance effréné et ses équilibres sociaux, son contexte politique et social apparaissent comme autant de défis. Pour les entreprises occidentales, notamment, il n’est pas possible de s’en remettre à un transfert pur et simple des pratiques managériales. Le présent rapport s’efforce d’enrichir et de compléter les observations antérieures par la prise en compte d’une dimension comparative. Cinq nouvelles entreprises seront spécifiquement étudiées, deux d’origine française et trois d’origine allemande, portant ainsi notre panel global à près de trente cas d’entreprises.
Topic:
Democratization, Globalization, Political Economy, Social Policy, and Multinational Corporations
Political Geography:
China, Asia, France, and Germany

42. Russia's modernization reloaded: Political constraints on economic development

Author:
Katri Pynnöniemi
Publication Date:
11-2010
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
Rumour has it that prior to his first visit to Beijing in spring 2008, President Medvedev instructed officials at the Ministry of Trade and Development to take a picture of Moscow that would aptly convey Russia's drive for modernization and innovation to his Chinese hosts. In carrying out his orders, employees from the ministry spent two months looking for a suitable place to photograph, but it is not known whether they were successful in their quest or not. Perhaps the story is only apocryphal, and no such order was ever given. Nevertheless, the anecdote has sown the seeds of doubt in the minds of the country's current leadership that there is actually not that much to see when it comes to the campaign for the 'technological modernization' of Russia.
Topic:
Development, Emerging Markets, Markets, Political Economy, and Science and Technology
Political Geography:
Russia, China, and Moscow

43. The Political Economy of Heterogeneous Development: Quantile Effects of Income and Education

Author:
Marcus Alexander, Matthew Harding, and Carlos Lamarche
Publication Date:
01-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Does development lead to the establishment of more democratic institutions? The key to the puzzle, we argue, is the previously unrecognized fact that based on quantitative regime scores, countries over the past 50 years have clustered into two separate, very distinct, yet equally-common stages of political development—authoritarian states with low levels of freedom on one side an d democracies with liberal institutions on the other side of a bimodal distribution of political regimes. We develop a new empirical strategy—exploiting exogenous world economic factors and introducing new panel data estimators—that allows for the first time to estimate the effects of development as well as unobserved country effects in driving democracy at these different stages of political development. We find that income and education have the least effect on democracy when authoritarian regimes are consolidated and that only country effects, possibly accounting for institutional legacies, can lead to political development. Ironically, it is in highly democratic and wealthiest of nations that income and education start to play a role; however greater wealth and better educated citizenry can both help and hurt democracy depending again on what the country's institutional legacies are. Far from accepting the notion that much of the developing world is cursed by unchanging and poor long-run institutions, policy-makers should take note that with democratization we also see country-specific factors that in turn condition the difference income and education make for democracy.
Topic:
Democratization, Development, Economics, Political Economy, and Third World
Political Geography:
Africa, United States, China, Asia, and Germany

44. China Rising: Peace, Power, and Order in East Asia

Author:
David C. Kang
Publication Date:
12-2009
Content Type:
Book
Institution:
Columbia University Press
Abstract:
Throughout the past three decades East Asia has seen more peace and stability than at any time since the Opium Wars of 1839-1841. During this period China has rapidly emerged as a major regional power, averaging over nine percent economic growth per year since the introduction of its market reforms in 1978. Foreign businesses have flocked to invest in China, and Chinese exports have begun to flood the world. China is modernizing its military, has joined numerous regional and international institutions, and plays an increasingly visible role in international politics. In response to this growth, other states in East Asia have moved to strengthen their military, economic, and diplomatic relations with China. But why have these countries accommodated rather than balanced China's rise? David C. Kang believes certain preferences and beliefs are responsible for maintaining stability in East Asia. Kang's research shows how East Asian states have grown closer to China, with little evidence that the region is rupturing. Rising powers present opportunities as well as threats, and the economic benefits and military threat China poses for its regional neighbors are both potentially huge; however, East Asian states see substantially more advantage than danger in China's rise, making the region more stable, not less. Furthermore, although East Asian states do not unequivocally welcome China in all areas, they are willing to defer judgment regarding what China wants and what its role in East Asia will become. They believe that a strong China stabilizes East Asia, while a weak China tempts other states to try to control the region. Many scholars downplay the role of ideas and suggest that a rising China will be a destabilizing force in the region, but Kang's provocative argument reveals the flaws in contemporary views of China and the international relations of East Asia and offers a new understanding of the importance of sound U.S. policy in the region.
Topic:
Conflict Prevention, Arms Control and Proliferation, International Trade and Finance, Political Economy, and Power Politics
Political Geography:
China and East Asia
Publication Identifier:
9780231141888
Publication Identifier Type:
ISBN

45. Africa: The United States and China Court the Continent

Author:
David H. Shinn
Publication Date:
06-2009
Content Type:
Journal Article
Journal:
Journal of International Affairs
Institution:
School of International and Public Affairs, Columbia University
Abstract:
The United States and China are the two most important bilateral, external actors in Africa today. While the United States wields more influence in most of Africa's fifty-three countries, China has surpassed it in a number of states and is challenging it in others. Both countries look to Africa as an increasingly significant source of raw materials, especially oil. China, more than the United States, views Africa from a long-term strategic perspective. Both countries seek political and economic support in international forums from African countries, which constitute more than a quarter of the membership of the United Nations. The interests of the United States and China in Africa are more similar than dissimilar. There will inevitably be some competition over access to African natural resources and political support, but there are even greater opportunities for cooperation that can benefit African nations.
Topic:
Oil and Political Economy
Political Geography:
Africa, United States, and China

46. Empire, Hegemony, and Leadership: Developing a Research Framework for the Study of Regional Powers

Author:
Sandra Destradi
Publication Date:
06-2008
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Regional powers are often conceived of as “regional leading powers,” states which adopt a cooperative and benevolent attitude in their international relations with their neighbors. The paper argues that regional powers can follow a much wider range of foreign policy strategies in their region. Three ideal-typical regional strategies are identified: empire, hegemony, and leadership. The paper is devoted to a theory-led distinction and clarification of these three terms, which are often used interchangeably in the field of international relations. According to the goals pursued, to the means employed, and to other discriminating features such as the degree of legitimation and the type of self-representation by the dominant state, the paper outlines the essential traits of imperial, hegemonic, and leading strategies and identifies subtypes for better classifying hegemony and leadership.
Topic:
International Relations, International Political Economy, and Political Economy
Political Geography:
China, India, and Brazil

47. China's Economic Growth: Trajectories and Evolving Institutions

Author:
Jun Zhang
Publication Date:
04-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper investigates the institutional reason underlying the change in the trajectory of economic growth in post-reform China, and argues that the trajectory of growth was much more normal during the period of 1978-89 than in the post-1989 era. In the former period, growth was largely induced by equality-generating institutional change in agriculture and the emergence of non-state industrial sector. In the latter period, growth was triggered by the acceleration of capital investments under authoritarian decentralized hierarchy within self-contained regions. Such a growth trajectory accelerates capital deepening, deteriorating total factor productivity and leads to rising regional imbalance. This paper further argues that the change in the trajectory of growth is the outcome of changes in political and inter-governmental fiscal institutions following the 1989 political crisis.
Topic:
Economics, Government, Industrial Policy, and Political Economy
Political Geography:
China and Asia

48. Energy Interests and Alliances: China, America and Africa

Author:
Danila Bochkarev, Angelica Austin, and Willem van der Geest
Publication Date:
08-2008
Content Type:
Policy Brief
Institution:
EastWest Institute
Abstract:
In the strategic policy communities of both the United States and China, there has been a knee-jerk blurring between competition in commerce between U.S. and Chinese energy firms and the potential for strategic competition by one country to deny resources to the other. A senior State Department official has described this sort of reaction as “exaggerated”. But the suspicion is there and it is ill-founded. It serves the interests of neither country. On the contrary, as this EWI Policy Paper suggests, energy security can become a rallying point in an otherwise difficult relationship. The two countries are now intensifying their interest and activities not just in each other's domestic energy sector but also in each other's role in a system of global energy security.
Topic:
Emerging Markets, Energy Policy, Political Economy, and Treaties and Agreements
Political Geography:
Africa, United States, and China

49. Regional Inequality and Convergence in Europe, 1995 – 2005

Author:
Arne Melchior
Publication Date:
11-2008
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
The paper presents new results on within-country regional inequality in per capita income for 36 countries during 1995-2005; focusing on Europe but with some non-European countries included for comparison. In 23 of the 36 countries there was a significant increase in regional inequality during the period, and in only three cases there was a reduction. Regional inequality increased in all countries of Central and Eastern Europe, while for most Western European countries there was little change. For the EU-27 as a whole, there was a modest increase in within-country regional inequality, but convergence across countries. The latter effect was quantitatively more important, so on the whole there was income convergence in the EU-27, especially after 2000. Regional inequality is particularly important for some large middle-income countries such as China, Russia and Mexico. In such countries there may however be considerable price differences across regions, and the use of common price deflators for the whole country may lead to a biased assessment of regional inequality.
Topic:
Economics, Political Economy, Social Stratification, and Sociology
Political Geography:
Russia, China, Europe, and Mexico

50. The Political Economy of Successful Reform: Asian Stratagems

Author:
Dennis Arroyo
Publication Date:
06-2008
Content Type:
Working Paper
Institution:
Walter H. Shorenstein 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, and Political Economy
Political Geography:
China, India, Asia, South Korea, Vietnam, Singapore, and Thailand