Chinese Economics Thread

[Jura The idiot]

I heard only now, through this source, so I hope you won't mind me posting here Richard H. Thaler wins 2017 Nobel Prize in Economics
Xinhua| 2017-10-09 20:38:50

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The 2017 Nobel Prize in Economics, or officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, was awarded to Richard H. Thaler "for his contributions to behavioural economics," announced the Royal Swedish Academy of Sciences here on Monday.

Peter Gardenfors, member of the committee for the Economics Prize said, Thaler's achievements successfully integrated economics and psychology, as he made economics "more human." And his theories "help people make better economic decisions."

Thaler, woken up early in the morning, told Xinhua at the press conference through telephone interview that he is currently focused on researches on "nudging" and the Swedish pension system. And he said he had not planned very far about his future researches.

Swedish Royal Swedish Academy of Sciences said in its statement that, Richard H. Thaler has incorporated psychologically realistic assumptions into analyses of economic decision-making. By exploring the consequences of limited rationality, social preferences, and lack of self-control, he has shown how these human traits systematically affect individual decisions as well as market outcomes.

Richard Thaler's contributions have built a bridge between the economic and psychological analyses of individual decision-making. His empirical findings and theoretical insights have been instrumental in creating the new and rapidly expanding field of behavioural economics, which has had a profound impact on many areas of economic research and policy, the statement added.

As one of the founders of the field of behavioural finance, which studies how cognitive limitations influence financial markets, Thaler discovered "limited rationality" in people's financial decision-making.

Thaler's theoretical and experimental research on fairness has been influential. He showed how consumers' fairness concerns may stop firms from raising prices in periods of high demand, but not in times of rising costs.

He also showed how to analyze self-control problems using a planner-doer model, which is similar to the frameworks psychologists and neuroscientists now use to describe the internal tension between long-term planning and short-term doing, according to the statement.

Richard H. Thaler, born 1945 in the

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, is Charles R. Walgreen Distinguished Service Professor of Behavioral Science and Economics, at the University of Chicago Booth School of Business, USA.

This year's prize is 9 million SEK (1.1 million U.S. dollars).

 

[Jura The idiot]

now I read
Beijing focuses on ‘reduction’ in development for first time

2017-10-10 18:58 GMT+8

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To become a “world class harmonious and livable city,” Beijing has decided to ease pressure through regional coordinated development in the next 20 years, a model may be shared by other metropolitans in China.

Authorities in Beijing released the full text of the city plan for 2016 to 2035 at the end of September, after it was approved by the country’s State Council.

As the capital city of world's most populous country, Beijing refined its position with focus on four areas, however being an economic center is not one of them.

The expanding of Beijing’s population and functions have surpassed the affordability of local resources and the environment, and the latest city plan is set to reduce the burden on ensuring sustainable development, said Shi Weiliang, a chief planner at Beijing city planning and land resources management committee.

The two major objectives for the plan are to remove non-capital functions and solve "big city diseases."

The latest city plan addressed “reduction” in development for the first time, Xiong Yuan, a researcher at International Monetary Institute of Renmin University, told CGTN on Tuesday.

Beijing will take an asset-light strategy without development space for heavy industries, and the city’s economy will be driven by the service industry, he said.

With a population of more than 21.7 million, Beijing has suffered from heavy traffic and is sometimes choked in smog.

Now Beijing claims to control its population through coordinated development of Beijing, Tianjin and Hebei Province, which is highly stressed in the plan.

Xiongan New Area in Hebei Province, which is unveiled in April, plays a key role in the joint development plan.

The new area, covering three of Hebei’s counties Xiongxian, Rongcheng and Anxin, is located 100 kilometers southwest of downtown Beijing and expected to absorb part of the non-capital functions of Beijing, especially high-end and hi-tech companies as the industry becomes mainstream.

A total of 48 companies, including Alibaba, Tencent and Baidu, will set up branches in Xiongan New Area, the local management committee announced on September 28.

Beijing is not the only metropolis in China faced with the burden of “big city disease”, Xiong said, noting Shanghai and Guangzhou should also consider unloading resources and functions in the future plan, Xiong said.

 

[taxiya]

That's was pretty tame compared to US politics. I agree that China should do it's own thing but China has to counter propaganda. Just look at how there's outrage over fake news implanted in the US by Russia on American social media on the internet. The West is already doing it trying to spur Arab Springs around the world on countries they don't like. I hear plenty of times from Westerners how they believe China can't feed their own people and depends on them for food aid. You may think of it as nothing but in Americans' minds it gives them an excuse to impose themselves on China because the Chinese can't take care of themselves.

I had the exact experience when I first came to Europe at the early 2000s. I was asked "do people in China all wear the blue/gray uniform?", I was shocked speechless. I am sure that today, newly coming Chinese won't face that exact question, but surely similar question just another form.

 

[taxiya]

I like this comment on youtube
China is the world's largest market for electric vehicles, thanks largely to subsidies that drive costs down. Those incentives will end by 2020, but the government is betting that won't be the end of the road for its electric dream. Photo/Video: Eva Tam/The Wall Street Journal

It is hard for new players to compete against Japanese and European combustion engine quality. So, it's also good decision in term of competition to directly jump to electric.
Because both start from the same starting point.Combustion engine is like an art it need to be honed over long period of time Competing against the established maker is like butting your head against the wall. they are Dinosaurus anyway

Another example of "leap-frogging" and "overtake through the curve". Also example of what South Korean did with LCD TV skipping to catch up CRT TVs from Japan.

 

[taxiya]

In this case, I think China should help Russia to build it... for a small fee of course, payable in gold or oil only.

I think it is more that Russia dragged her feet rather than lack of material resource to build which China is always willing to provide, the massive CPEC in Pakistan is a good evidence.

 

[AssassinsMace]

I had the exact experience when I first came to Europe at the early 2000s. I was asked "do people in China all wear the blue/gray uniform?", I was shocked speechless. I am sure that today, newly coming Chinese won't face that exact question, but surely similar question just another form.

Silvio Berlusconi believed Chinese people ate babies which I've heard before of stereotypes believed in Europe.

 

[siegecrossbow]

Silvio Berlusconi believed Chinese people ate babies which I've heard before of stereotypes believed in Europe.

So did Senator Wolf from Virginia, for that matter.

 

[dragoooons]

News on China's scientific and technological development.

Responding to theses posts here since the other thread is about science and technology.
@Jura
Workers should be expected to make decisions regarding how their workplace is run. Stock options are given to workers to make them partial owners of a business in order to motivate them to work more for the good of the business. My idea is to remove stocks from the picture and give workers 1 man 1 vote control over a business. We accept democratic representation in government so why not implement it in economics.

Another form of organization more common in USA is a employee owned and operated business/ worker coop. There's no major communist party organizing factory councils in the USA but there are still worker run businesses.

News on China's scientific and technological development.

@dragoons
I believe you bring unrelated subject to the discussion as well you either misunderstood my post or you twisted my post
I will address your rebuttal one by one
I never say that China should rely only on Capitalism What happened in US and UK is the extreme version of capitalism due to blind adherence to ideology. My kind of capitalism is close to European aka German style capitalism where the state play active role in the economy and regulate the economy...

You wrote much about the need to regulate capitalism and favor German over Anglo capitalism. I too thing German capitalism is better but that is like saying cancer of the skin is preferable to cancer of the lung. Regardless of what brand of capitalism a country follows, the balance of political power in a capitalist economic system favors the capitalists not the proletariat. Regulations won through labor movements are being dismantled in many capitalist nations in Europe and even some "socialist" nations such as Norway. It might have taken 70 years to unto those pesky regulations that cut into profits but this is the inevitable result of a political system whose members are part of the capitalist class. Look at the composition of governments in western nations and you will find that the majority are capitalists.

Maybe the Chinese state has yet to be taken over by capitalists but you cannot guarantee that in the future this will not change. A future economic crises will push Chinese capitalists to clamor for austerity like the European capitalists did after 2008. The state may resist or it may surrender. Either way the Chinese working class should not gamble their economic livelihood on power balance between the state and capital.

Things may be stable and good for the working class while the economy grows but crises trigger a scramble for the economic pie and historically it was capitalist class who got the better of this struggle, not the working class. Which leads me to another important point. Capitalism is a system the requires exponential growth. When you have a growing population or more markets to expand into this is fine. But you cannot assume that the population will grow indefinitely and you cannot assume that there will always be new markets to expand into. Also since you condemn materialism and unrestrained consumer behavior you probably don't believe that China can or should drive up domestic consumption without limit. Economic growth must halt at some point. I hope it is clear that the economic future of China doesn't lie with capitalism. A new system that can handle the growth question and the question of democratic rights for the working class is needed. Don't view this as an endorsement of liberal democracy which is simply a mask for rule of the capitalist class.

Anyways if you want to learn more about capitalism as it exists and not as neo-classical economists idealize it, Anwar Shaikh's 30 part lecture series on his book Capitalism: Competition, Conflit and Crises is very good.

 

[Jura The idiot]

News on China's scientific and technological development.

Responding to theses posts here since the other thread is about science and technology.
@Jura
Workers should be expected to make decisions regarding how their workplace is run. Stock options are given to workers to make them partial owners of a business in order to motivate them to work more for the good of the business. My idea is to remove stocks from the picture and give workers 1 man 1 vote control over a business. ...

... thanks for explaining what you meant
#3658 dragoooons, Yesterday at 4:36 AM
in the part which puzzled me; I'm done here

 

[Jura The idiot]

now I read
Spotlight: IMF raises China 2017 growth forecast due to its progress in economic reform
Xinhua| 2017-10-12 05:41:53

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The International Monetary Fund (IMF)'s move to raise its forecast for China's economic growth to 6.8 percent reflects the country's recent progress in trimming financial risks and deepening economic reform, U.S. experts have said.

IMPRESSIVE GROWTH RATE

In its latest World Economic Outlook released Tuesday, the IMF expected the Chinese economy to grow 6.8 percent this year and 6.5 percent next year, both 0.1 percentage point higher than its previous forecast in July.

"The growth rate is wonderful compared to the growth of many other countries," Farok Contractor, a distinguished professor at Rutgers Business School, told Xinhua on Tuesday.

"Off course it has come down from the previous eight or ten percent, but that is still a very healthy growth rate and that should be the envy of any other country in the world," he said.

According to IMF, the upward revision to the 2017 forecast reflects "the stronger-than-expected outturn in the first half of the year underpinned by previous policy easing and supply-side reforms."

"There have been a lot of achievements in economic management in China...I would say that the 6 percent path the China is on will be sustained for quite some time now," Contractor noted.

DEEPENED REFORM

In the past few years, China has been intensifying its efforts to trim financial risks and shift the economy from large-scale stimulus towards consumption, services and innovation.

Analysts said such structural reforms could help the country to maintain a more sustainable economic growth in the long run.

Paul Sheard, executive vice president and chief economist of S&P Global, told Xinhua in a recent interview that China's credit-fueled infrastructure and residential housing investment in the past decade led to a build-up of debt and credit in the economy, which is why economic reforms are critical.

China has adopted a range of measures to manage debt risks and push forward reform in recent years, including introducing a new high-level committee on financial stability and development in July.

Stephen Roach, a senior fellow at Yale University and former chairman of Morgan Stanley Asia, lauded Chinese government's determination to reduce financial risks.

"China's central bank, the China Banking Regulatory Commission, and the State Council have all taken explicit actions in 2017 to reduce the expansion of debt -- especially the mounting indebtedness of state-owned enterprises," said Roach in a recent interview with Xinhua.

"These efforts now seem to be having a positive impact...As long as China continues to emphasize financial stability - and takes actions aimed at promoting it - the threat to growth and development should not be serious," the expert added.

Sheard said it's important that institutional and market-enhancing reforms that create the right incentives for capital to be allocated efficiently continue to be implemented.

He points out that reforms should also continue for the necessary rebalancing of the economy from excessive reliance on investment to household consumption becoming the key driver of economic growth and rising living standards.

China's economy expanded 6.9 percent in the first half of 2017, with consumption and services, and new innovation-driven economic sectors taking up larger roles, according to data from the National Bureau of Statistics.

GREATER CONTRIBUTIONS

"In the last five or ten years, more than one-fourth of the world's economic growth has come from China alone, and that's a big stabilizing factor," said Contractor.

In face of the trend of de-globalization in western countries, the professor expected China to play a more crucial role in global economic development.

"Unfortunately we're in an era where in the countries like the United States and Europe, there is a lot of introspection, inward looking, angst (towards globalization)," Contractor said.

"To maintain the path of progress for humanity economically and socially requires a country like China to take the leadership position in setting the rules," said the expert, who has been visited China for many times.

In terms of international business, "whether it is exports or foreign direct investment, you also need leadership. While the west is in a state of self-questioning, China can play a role," he said.