Monday, December 27, 2010

Interviews with Steven Cheung Journal of Chinese economic system

 Zhang Wuchang of Chinese economic system
This is winter, Zhang Wuchang barefoot wearing a pair of slippers, and holding a stainless steel cup, more gray hair than ever before, always maintained the attitude mm bristle does have anger to words, although the recently published has a thin, too loud, but in the end who really understand this one through seventy years of the old people? about China's economic system, the , no time do deal with. system is a very difficult question. I follow up on three decades of China's development, can only write this book. explain the process is very, very difficult. can be explained from the beginning, I realized this is very important The. how can explain so? three decades of China's economic development so fast, of course, is a miracle. But China's miracle is not, as some economists say mm, not in the eighties of last century that time, the nineties is the age of miracle.
any country, as long as the past is to eat the same big pot, and economy to a market with more private nature, the rapid growth is a very natural thing. the pre-reform level of China's economic development than can be said now is close to zero, up from zero so that a low level of several hundred percent, it is nothing. around 1984, some parts of southern China, each year half of the year. At that time, only a percentage of the U.S. Third, Hong Kong is six percent, seven, and China has fifty percent in some areas, do not be proud of. from scratch, with some small changes to increase rapidly. you are too young to know the previous system of state employees, do not do is thirty-six. At first there were contract workers in Guangdong, when rose from thirty-six dollars a month more than a hundred dollars a month is very easy.
the growth of the 1980s, primarily the right to change the problem definition. At that time in China, the responsibility of the contract by contract, the rights defined by the level of the system (that is the result of China's cadres in accordance with the seniority level of order) phase transition, defined as assets rights system, which is my opinion, is to explain the development of China's three decades the focus of. in 1984, 1985, when I speak out: the separation of ownership and use rights, ownership is not important. until 1986, I Shougang to do the report, said contract agreement to separate ownership and use. many people have criticized me, and afterwards the audience has been warned. but then I know this is no problem, I have so many years of research in , how can there be so easy wrong. Great minds think alike, and later in 1987, Mr. Deng Xiaoping put forward such a separation of ownership is the basis of socialism with Chinese characteristics.
1981 years time you say the big Chinese economy Change is inevitable.
Steven Cheung: I had been in 1970 when the separation of ownership and the question presented here, I did not understand why so much emphasis on the ownership of law books, because private property rights should not be from the perspective of ownership view, China's contractual agreement, in principle, can be separated from ownership, use, contracting can be an indefinite contract. I wrote in 1969, an article published in 1970 made it clear that private property is not there private ownership, that time Coase also agree with me.
that big pot of the system, it will cause the dissipation of rent (Editor's note: rent dissipation of valuable resources or assets that, because there is no clear definition of property rights, appear in the competition or value of the decline in value disappear), this theory I have done more than anyone else. You want to reduce the rent dissipation, it would be constrained competition. In order to be binding competition with the pre-reform China, the level of seniority to define rights. At that time in ten administrative level, each industry has its level, and even buy an egg should be about level. the reasons for this arrangement is to reduce rent dissipation.
human capacity is inherently unequal , how could equality?! I was born have their own talent, with a lot of people are not the same; you the young lady born beautiful, some are naturally beautiful; some natural body good, and some natural physical shape; Some see a school on the first exam, and some do not how to read the line; some people a little better luck. But we can not distinguish the issue of luck ah, ah skills question, you said Li Ka-shing is luck, skill or good? It's hard to say. to constraints of luck, it would hurt the ability aspects. God is made man, the capacity is unequal.
premise in this question is, if in a social rights equal to every person in the not to be. are equal before the reform of property rights, then use the level that is necessary to define the right. Now, China is the property of inequality, but that level of inequality in the pre-reform dissipated, and you do not like it, come the Revolution The veteran may not like it, but you can not two things are equal. Therefore, changes in the eighties, mainly defined by the level of rights to the assets of defined rights, without turbulence is not easy to achieve this transformation, the contract responsibility The emergence of the contract a great help.
large number of social change will always damage the interests of vested right.
Zhang Wuchang: the right to change the definition of assets means that the distribution of income to re-shuffle, those with vested interests who is difficult to accept. I have suggested that the level of Beijing right before the buyout money, when Beijing's some of my friends agree, but obviously, this is difficult to do so. the result of corruption was to appear as an alternative method of compensation the. how vested interests of those who buy it? corruption is a way, is a obvious buyout. 1984, 1985, when corruption began, I was happy because it is inevitable that the process , from the level of defined rights to the assets of defined rights, nearly impossible, how in the past ah? corruption appeared to indicate passed.
but beyond that there is no corruption in the interests of China, harm than good. some of the economic scientists think they are awesome beneficial to economic development of corruption, in other words, economists do not understand the real world too much. You look at the economics of a majority of all waste; you look at the current U.S. statements of financial crisis, the scholars, the majority did not explain the force.
1985, when, Beijing recommended that the product classification, classification control, I shout: This is the way to India! you a sorter control, was supposed to Go from level to define the right to define the right balance, but the control center can also be used to define the rights of corruption, that is, the system was in India, Panama's system. For example, say you charge a woman's purse, the man responsible for the man's bag, another person responsible for the foreign exchange control, each have their own greed, corruption can be defined such a system is the right to write in his will bequeath to future generations of. Panamanian customs officials to corruption Whoever hath you, I greed two hundred forty-six, which are is defined, I said, we must embark on a defined path in India, so I did speak out. because once took to the road in India, corruption is fixed down the system, you define the rights of corruption, the reform will be stalled . Fortunately, there is no control of the final classification purposes.
China's economic miracle they are today, there are a lot of good cadres. you say they have corruption, I admit, you say they have bad I have to admit, but most of were good. kidding! If most people have to misbehave, how can today?
Similarly, there is no economic miracle nineties, there is no today.
Zhang Wuchang: the eighties the rapid growth of Chinese economy is the right to change the problem definition, the right arrangement of different methods, not a great miracle for granted. But by the nineties, it really is a miracle. RMB 1993 collapse charge of the economy, Zhu Rongji, China's economy from high inflation into deflation, prices fell three-quarters of Shanghai's high-priced houses, one from the twenty-five thousand square meters, fell to a seven thousand square meters; Shenzhen also fell eighty percent, Golf Course membership card, unwanted. everywhere the voice of bankruptcy.
was at that time, the Yangtze River Delta's economy began to shoot up, between the more than eight years starting as early as the Pearl River Delta, this is the miracle . Since 2000, a few years, the explosive increase in the income of farmers: from 2001 to 2007, annual real income of farmers increased by 20%. So I am opposed, very opposed to the two write that Chinese farmers (Chen Guidi, Chuntao , what to do. rich-poor gap narrowed rapidly, twenty percent of farmers growing each year, eight per cent of urban growth, sooner or later to pull narrow the income gap. So the new temper, such a good situation, but he gave it a stick, a million workers to go back in the country, many would not be willing to come out now, industry has trouble shortage of migrant workers, and why the introduction of such a thing? so great loss, who got it responsible?
go back to the miracle of the nineties. in China is so difficult, serious case of deflation, if we also count increase product quality, then this is a very serious deflation, prices fall so powerful, why have explosive growth?, as now, is to protect eight of the nineties, how to protect eight? a Jiaojiu Ming's voice, that China can protect eight, this is a miracle. followed by farmers explosive revenue growth, This is a miracle. working-age farmers, there are three of four away from home, are out of work.
how to interpret a near-miracle of the Jedi back then?
Zhang Wuchang: how to explain? explanation is that the Chinese County competition system. this system from the late eighties, to be fixed in 1994. The county's competitive system, that is where the economic miracle. Deng Xiaoping's economic miracle is in the south since the spring of 1992, 1993, began to develop , the competitive system at that time the county began to form, to 1994, the value-added tax to begin the national unification, seventeen percent you all know. But my question is: which system you find it? I can find this system with other countries, other places is different and very difficult to focus on where it?
I began to follow up on this 1985 change in the layers of contracting, the domestic good friend to me, What information I gave them me, and sent three research assistants to help me, I want to get the file no problem of any contract, they know I am scholars. But the information I give to me, how China's shift to see you in the end it? genius can not help. can be considered a God, you look at other foreign friends say, one thousand nine hundred and sixty years later, the line some of my colleagues thought I was the best system of economists, the transaction costs of experts. Connaught Adams, Coase, Basel, they said, so returned to Hong Kong in 1982, when the system's master I, together with domestic friends to help me: I want the contract and a phone call and sent; where I'm going to investigate and immediately sent me to; they sent me to the Shougang Group, in the quarters some days; and send me to Wenzhou. Now, some critics said: model, not to mention me? , I'm just concerned about China only. you ask me, I will truthfully say that I will not lie about the last part. I do not necessarily right, but I do not believe, I would not say, in addition to bully me like the Sun to meet daughter, I never said a word you do not believe, you accept to accept, not accept is not acceptable.
cadres of friends to help in many areas, a lot of business, corporate friends to help, so to be able to explain the system. I am quite difficult to explain, but I consider myself very satisfactorily explained, and do not see a missing link, of course, some parts I can not write too carefully. In fact, this amounts to a long article, in fact, the whole issue should be a thick book to deal with, but I am old, and have a seven-year-old how to write thick books? so just write an article. I am very satisfied with this article.
you mentioned, the competition system is the county economic miracle which, at first glance from the eye is not quite the county, usually everyone says that Beijing and Shanghai.
Steven Cheung: I found this in 1997, the importance, that is, regional competition. regional competition in the world Yes, but the Chinese are different. writing this book was the first important reason is that I find China's regional competition is different. This is a great find. Why is there such symptoms? This is the first priority. s Two key point is, to 2003, I learned that the county is the protagonist of competition, only to find that the expansion of the contract by contract, to the eighties with the system of contracted responsibilities, go to the use of the above areas. In fact, After the success of a trial in agriculture, the introduction of state-owned enterprise contract responsibility system is a failure, and then introduced into the region through the layers of contracts rather than individual enterprises is a very important achievement.
it is difficult to find, if I am not from the 1979 began to follow it, can not think of that. plus VAT, in fact, inside is divided into tenant, the rent is actually a tax, which is difficult to see. the most difficult thing is that seventeen percent of the value-added taxes are the same country, how would there be efficient? this point I think eight or nine months. I mentioned in the Book of the Marshall in a footnote, because I slept one night half asleep, suddenly think of a few decades ago to see the footnote immediately to get it out through the only solution. county government can provide improved low-cost or free land in such a > Ten years later, the county's competitiveness may be diminished. Kunshan is an example, Kunshan now is basically no vacant land, development of no previous flexibility. that the Government should encourage industries to try to hi-tech development and hi-tech development value-added tax on high. engage in land-use reform can not be permanent, will one day run out. But you land a good job, and to solve the biggest problem. in the late nineties to 2007, economic development in the very fast, is to use inter-county competition. the competition for land use reform, it should go in ten years, while China's unique system of inter-county competition to persist for a long time.
2007 years after it, you are most opposed to out of the new labor law.
Steven Cheung: I stand on the labor law is right, no doubt. I get a hundred dollar bet with you, are sure you will lose. should now be a lot of people agree with me point of view. I study the theory of marginal output, forty years ago published get the best paper award, the contract is written. to support the new labor law claim, a look that is a mess. cadres are aware of any place, all the factories have to know. I believe the Government already know, but since the launch here how to do it?
the introduction of the new labor law will at least help some low-income people to improve treatment of it.
Steven Cheung: I study focused on poor people. China's poorest farmers food to eat, then the other The do not need to worry. but the Government should not subsidize them, they can not live on welfare, can not be sustained because the Chinese people too much, too little gold mine iron ore. Australia can send money, fewer people, minerals and more. New Zealand can money, Canada can send money, Russia can send, but China can not. the only way the poor in China, is to have a system to give each of them have the opportunity to become self-reliant.
China is now the case, can not rely on benefits of economic dependents, the minimum wage can not help them, it will harm them. the poor the opportunity to find a way to increase self-reliance, which is the only way, there is no other way. have been China's development is fine, from 2000 to In 2007, development was very good. Since 2000, when the income of farmers is only two hundred a month, and now a thousand or so, the equivalent of two thousand urban incomes, cheaper housing, as farmers, food is cheap. If farmers per capita income can be increased to two or three thousand dollars a month, and that situation is very good, and this point should not be too difficult.
you so sure that the income of farmers has been a big improvement?
Zhang Wuchang: Because I have been to many poor rural areas of Guizhou and the survey of working-age people really go three quarters. increase the income of farmers, how do I not know? industry, agriculture, commerce, I have my own check station, which is My approach has always been not to see the data to see the report. I am not saying the report deliberately allowed the Chinese government, but is difficult to accurately and mobile population so long, how statistics? So you want to go out running, out of observation. Agricultural how ah, the price how changes in ah, I have been following. I went to ask every few months. I believe that their own investigations.
how to further improve the income of the farmers do?
Zhang Wuchang: The key is the prices of agricultural products must be up, the knowledge of farmers must be improved. Do not drive down prices of agricultural products. To increase the income of farmers against imports of agricultural products on it, but it is inferior to the. Japan in the mid-seventies, since the prohibition of imports of agricultural products, the retail price of tomatoes had to a five-dollar one. Now that China's agricultural prices normally go up, or cheap, it should be up, but do not learn Japanese. I have a orchard for several years, no way to play tie: litchi out that two semi-wholesale pound, how do you do, costs are more than two half-pound, but also pesticides, but also fertilizer, but also trim, please pick people. to sell two and a half, how to make money? first two years of rising prices of fish, because the government purchases, and now not collected. the first two years prices have gone up very fast Lotus, and now fell down. you buy vegetables, three or four dollars a pound, farmers happy. you buy fish, ten eight pound, farmers happy. this price acceptable to all. I wrote an article in 1996, is a good thing.
so to speak, until China's poorest farmers have a good income, China's successful economic reform, even if successful.
you are on welfare against the Chinese economy, but now it would be wholly trend in the world ah.
Zhang Wuchang: The United States is now good? German workers good? France is now good? they themselves are a mess, they have a job? the United States vast land, old times, now unemployed , and we have to learn him? piece of flat land in the United States, farm vehicles are still a few days to open farmland. people such favorable conditions, engage in labor law, welfare, minimum wage, now have a problem.
China Why Study United States, China have? West so much, to high oxygen. Xinjiang is so big, lack of water. Guilin scenery is beautiful enough, so mountainous, how to till the fields? are the stone quarry by friends. but we China, there is one thing, not the United States and Europe, Chinese and more. There are as clever Chinese people, eat the bitter, these are very valuable.
foreign people who do science, they were so good conditions, we can not learn. I was young, studying over there, spent a week at least one hundred hours of work, school. My son is a doctor in the United States, each week, eighty to one hundred hours of work. Why can not the Chinese workers work more than more than forty hours? we have such great, such a baby, so expansive? These are delirious. engage in the new labor law experts concerned about the Chinese workers are concerned about their son, Zhang Wuchang than I need more, you believe in? you phase do not believe the economists, concerned about China's workers and farmers, more than concerned about their son? not impossible. are fake, I can not get angry.
including the controversy over the new labor law, including, Indeed, in recent years, many of your opponents.
Steven Cheung: I do not know what these returnees engaged in China in recent years launched an unsuccessful economic policies are basically the abstract from these returnees imagination. they have any understanding of the system, what the Chinese know, I do not know. but I do my own development issues in China, spent a lot of effort, and even criticized by many people, said Zhang Wuchang to give up academic, do not write English articles. I will never face the situation in China, I used to be spent from the time of famine in China, but also suffered. I now have a chance to explain China's economic system, which I still have time to write articles in English ah ? now within the economic evaluation of the line, depending on the number of English articles published to score. I used to get zero in Hong Kong! I did not say. This is who invented the Chinese language is not academic? write English be considered? Unfortunately, those who the heat of rising star big words, not written in English at home.
is indeed a lot of people say to give up academic Zhang Wuchang, even the foreigners are saying. foreigners say that they do not know the facts; the Chinese people themselves say, is underestimate China. as I write the What contribution ah? I said I was learning your economics, I want to learn English; you now want to study economics, you should learn Chinese.
very admired the Chinese model of foreigners, you like do not say this words.
Zhang Wuchang: what foreigners know China, what the Chinese model ah? many foreign scholars to write articles in China, do not know anything, the data from the government brought a pile of things to come out and do some regression analysis , and then add a few words is not enough equations, What kind of learning that?

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