*Demystifying the Chinese Economy*

by on January 11, 2012 at 10:40 am in Books, Economics, History, Political Science | Permalink

That is the new book by Justin Yifu Lin, who is also Chief Economist of the World Bank.  It is derived from lectures delivered in China.  Much of the book is an OK survey, though I did not find it added much insight to extant accounts.

The discussion of why China had no Industrial Revolution does not consider individualism or liberalism, a’la McCloskey.  And what am I to make of sentences like this?:

Building the new socialist countryside, now on the right track, has produced remarkable results.

I suppose it can be held to be true in both the literal and Straussian senses, but when I read it (and some others) frankly I felt my intelligence was being insulted.

There is plenty of talk lately about ethics standards for economists.  How about a new proposal?  For anything in the social sciences written by a citizen of China, or by someone with relatives living in China, or by someone working in or for China, there should be a disclaimer on the publication: “Produced under conditions of censorship and threat of career penalty.”  I don’t favor actually doing that, but the absence of this idea from the debate is itself revealing.

1 CBBB January 11, 2012 at 10:46 am

I think I got that this guy was Chinese by the name, no disclaimer needed in this case. But you might be right

2 Careless January 11, 2012 at 11:35 am

You know, there are Chinese people who have never been in China

3 CBBB January 11, 2012 at 12:35 pm

ARE THERE? Well that’s news to me

4 TT January 11, 2012 at 10:25 pm

Do you know why Tyler was so hostile? His ex works for the World Bank. lol

5 Careless January 12, 2012 at 11:25 am

Just try to make your stupid comments less stupid, ok?

6 So Much For Subtlety January 12, 2012 at 2:52 am

He is actually Taiwanese. The quality of his work is probably not best judged by the fact that he defected from Taiwan to the Mainland in the early 1980s I think. Yes, this guy actually defected to a repressive Communist dictatorship, as it was then. I know people who know him. He is smarter than he sounds.

7 anti-Mon January 11, 2012 at 10:53 am

But you haven’t even been to mainland China once. How do you assume that you know more about mainland China than him??

“Building the new socialist countryside, now on the right track, has produced remarkable results.”

Is it the word “socialism” that offends you? I thought you were different from other GMU hard core libertatirans…

8 Willitts January 11, 2012 at 11:02 am

Libertarians are for freedom.

Academics are for free and independent thought.

China and Lin demonstrate neither.

9 anti-Mon January 11, 2012 at 11:04 am

Freedom? I assume the slaughtered Indians understand what is the so-called freedom.

10 dan1111 January 11, 2012 at 11:14 am

If the phrase “non sequitur” did not exist, it would have to be created specifically to describe this comment.

11 anti-Mon January 11, 2012 at 11:21 am

I was saying that things should be understood from a historical perspective. Colonization was done under a justified beautiful ideology.

12 dan1111 January 11, 2012 at 11:37 am

Well, that makes sense. But what you actually said implied that modern libertarianism is responsible for the slaughter of the Indians

13 anti-Mon January 11, 2012 at 11:39 am

Liberty and freedom are not a modern concepts.

14 Cliff January 11, 2012 at 1:37 pm

What justified beautiful ideology was responsible for the slaughter of the “Indians”? Not libertarianism, surely?

15 The Original D January 11, 2012 at 4:09 pm

Manifest destiny

16 tkehler January 11, 2012 at 12:50 pm

It’s true. China and India did fight a couple of little border skirmishes.

17 anti-Mon January 11, 2012 at 11:07 am

How do you know Justin Lin didn’t have “free and independent thought”? Because he’s from China?

He swam from Taiwan to China in the early 1980’s in order to lose his freedom of thought?

18 anti-Mon January 11, 2012 at 11:09 am

You guys growing up in American societies and educated in your Western tradition don’t even try to understand the visions and ambitions of an intellectual from a developing country. You think you are with the truth without considering the history and constraints of developing countries. That’s why I feel sad.

19 jim January 11, 2012 at 11:22 am

China’s intellectual tradition is weak. It lacks awesome sauce.

20 anti-Mon January 11, 2012 at 11:25 am

True, China’s intellectual tradition is still weak now. But the Chinese are working very hard to improve this. Don’t forget how poor this country was 3 decades ago. And they strive to contribute their portion to the intellectual world as well.

21 Careless January 11, 2012 at 11:37 am

a poor intellectual tradition 30 years ago because they had just finished throwing teachers off roof tops

22 anti-Mon January 11, 2012 at 11:43 am

Do you know why the Qing Dynasty declined? Because the Manchus didn’t want to check out what changes were going on in the other side of the world. They assumed that they were the best and they would be the best forever. If Americans still focus on what was happening 4 or 5 decades in China without bothering what is happening now, they are gonna lose just like the Manchus.

23 JWatts January 11, 2012 at 2:01 pm

“If Americans still focus on what was happening 4 or 5 decades in China without bothering what is happening now, they are gonna lose just like the Manchus.”

You might have a point if your statement even remotely resembled reality. Take a deep breath for a moment and realize TC was reading a book about current China. So to imply that American’s are focusing on 1960’s-70’s China is patently absurd in context. That view is not even true of your average American, let alone anyone who studies the matter directly. The US News agencies routinely report on Chinese mass production, it’s space program, it’s increasing wealth, it’s colonial practices in Africa, it’s energy production, etc.

24 Careless January 12, 2012 at 11:27 am

Actually, jwatts, I’m pretty sure he was referring to his own comment about China 30 years ago. It didn’t make much sense, though.

Also, “it’s” means “it is”

25 Cliff January 11, 2012 at 1:38 pm

Are you disputing that China engages in rampant censorship?

26 GMU student January 11, 2012 at 2:22 pm

@ JWatts
“TC was reading a book about current China.“

Please read the book yourself. The first 5 chapters of the book is about the history of China. You can find the content of the book at Amazon.

27 Cliff January 11, 2012 at 3:21 pm

I am confused. Is this meant to be a response to me?

28 JWatts January 11, 2012 at 3:56 pm

“Please read the book yourself. The first 5 chapters of the book is about the history of China. You can find the content of the book at Amazon.”

I looked at the preview on Amazon. The 2nd page of the book has a chart on GDP in China from 1870 to 2007. The first chapter seems to talk extensively about the changes from the 1970’s to 2010. I fail to see how that’s not a book with a ‘current’ view of China. It certainly is not a book about pre-1980 China as the original poster implied.

29 Careless January 12, 2012 at 11:29 am

Well obviously “now on the right track” means it’s talking about the Ming dynasty.

30 dan1111 January 11, 2012 at 11:11 am

The sentence contradicts (or at least ignores) widely reported information about problems in rural China. One can question it without claiming to know more about China than the author.

I’ve never been to Antarctica, but I wouldn’t believe someone who told me it is warm and sunny, no matter how much firsthand knowledge the source had.

31 anti-Mon January 11, 2012 at 11:17 am

I’m afraid you haven’t read the sentence carefully.

He said “now on the right track”..

The problem is that most of you are using a horizontal vision, comparing China with other developed countries. Of course there are many problems. Why not see from the vertical vision? How have things been improved these years?

32 jim January 11, 2012 at 11:26 am

Why not the perpendcular vision? The parallel vision is so Western. It lacks orthogonality.

Anti-mon is wise in so many, many ways.

33 Bernard Guerrero January 11, 2012 at 12:36 pm

+1 for “It lacks orthogonality.”

34 q January 11, 2012 at 4:13 pm

This isn’t about comparing China with other developed countries. This is about comparing rural China with urban China. Yes, of course, everything in China has improved in the last 30 years, but some areas much more than others. Notwithstanding Justin Lin’s claim that rural China has shown “remarkable results.”

35 q January 11, 2012 at 3:34 pm

“Is it the word “socialism” that offends you?”

C’mon, this is Tyler Cowen. It’s not as obvious as that. I’m guessing he’s surprised by the word “remarkable,” given the following sentence:

“I suppose it can be held to be true in both the literal and Straussian senses”

The truth is, the Chinese countryside is remarkable not for whatever success Justin Lin is trying to tell us, but for the lack thereof compared to the Chinese coastal regions. And its relative failures have a lot to do with the top-down style of controlling labor movement. You don’t need to have been in mainland China to know this.

36 anti-Mon January 11, 2012 at 4:29 pm

‘”And its relative failures have a lot to do with the top-down style of controlling labor movement.

This is exactly the point Lin raised in Chapter 3 of his book. The huge gap of rural area and Coastal area was the legacy of the Communist era. Then Deng Xiaoping said in 1978 that:” We should allow some people and some areas gain rich first. ” Then the Coastal areas became the first areas that got rid of poverty. This was the step- by-step reform.

The Hu Jintao and Wen Jiaobao generation have been striving to solve the problem of inequality. Please read this period of Chinese history seriously.

37 8 January 11, 2012 at 10:54 am

I liked this one: Obama vs. Hu: New Year’s Messages. “Obama: I promise to do everything I can to make America a place where everyone has a fair shot and everyone does their fair share,” the post read. It continued: “Hu: In the new year, we will hold high the great banner of socialism with Chinese characteristics. Taking Deng Xiaoping Theory and the ‘Three Represents’ as guidance, we will thoroughly implement the scientific concept of development.”

This shows that Chinese leaders’ grasp of theory is higher than America’s,” he said. “When it comes to Chinese leaders’ reports, they’re full of doctrines, theories, flags, symbolism, even God can’t understand this talk and jargon. In fact, there’s only one purpose to this: to make regular people dizzy, so that they can do whatever they want. You can claim the mantle of any doctrine for anything you want to do.”

38 anon January 11, 2012 at 12:43 pm

And don’t forget that we can not pay China back in clunkers:

“You are not allowed to pay us back in clunkers.”
— Chinese Pres. Jiantao to US Pres. Obama
http://www.liveleak.com/view?i=d9c_1258865433

39 anti-Mon January 11, 2012 at 10:55 am

You and Justin Lin are situated in two intellectual traditions. He’s Confucian. .

40 Cliff January 11, 2012 at 1:40 pm

And that means…?

41 GMU student January 11, 2012 at 1:53 pm

There should be more mutual understanding. This post is insulting.

42 Cliff January 11, 2012 at 3:21 pm

I meant, what does it mean to say someone is a Confucian?

43 anti-Mon January 11, 2012 at 4:17 pm

Please read another book of Lin: “Benti and Changwu”. His core value is Confucian:
http://www.cengageasia.com/cos/o.x?ptid=438&c=/tla_cws/catalog&func=view&id=3253

44 Careless January 12, 2012 at 11:36 am

well, then Lin shouldn’t have written it

45 gwern January 11, 2012 at 11:19 am

People unconnected to China can make some pretty horrific mistakes writing about it. Personally, I don’t see the need for a disclaimer in that case any more than your suggested case – they balance out.

46 Crenellations January 11, 2012 at 11:40 am

The excellent blog of Patrick Chovanec (prof @Tsinghua University’s School of Economics and Management in Beijing), often makes that exact disclaimer and also delivers better reporting on the Chinese economy than any newspaper in America.

47 anon January 11, 2012 at 12:36 pm

+1

48 Cindy January 11, 2012 at 12:22 pm

“For anything in the social sciences written by a citizen of China, or by someone with relatives living in China, or by someone working in or for China, there should be a disclaimer on the publication: “Produced under conditions of censorship and threat of career penalty.” ”

Wow! I mean, Wow! Do you actually believe that?

49 GMU student January 11, 2012 at 12:28 pm

I tell you a secret. I’m a GMU student. In GMU the dominating academic group is Austrian Economics.

Once I wrote an article about market failure. Then I lost my fellowship from that group.

I was like: What? I thought there is freedom of research… OMG…

50 CBBB January 11, 2012 at 12:36 pm

Exactly – China’s not the only tyranny in the world.

51 Andrew' January 11, 2012 at 12:40 pm

You can lose funding for almost anything. Experience academia is the best and the worst and possibly only way to understand how bad academia is.

52 Bernard Guerrero January 11, 2012 at 12:49 pm

Good grief. Lemme know when GMU starts executing wreckers and the like, eh?

53 GMU student January 11, 2012 at 12:55 pm

After I graduate from here, I will let you guys know. hahaha

54 CBBB January 11, 2012 at 1:11 pm

I mean what do you expect from this group of cultish economists totally devoted to ideological purity?

55 GMU student January 11, 2012 at 1:55 pm

Many people are like that: If you disagree, they crush you. And they do this under the solemn name of intellectual liberty.

56 Andrew' January 11, 2012 at 5:42 pm

Don’t miss the point, academia is very much like a communist dictatorship.

57 Harrison Nguyen January 11, 2012 at 8:34 pm

Do GMU official harass you on daily basic? Do they put you into home detention? Do they threat you to jail, or make you “vaporize”?

58 GMU student January 11, 2012 at 8:44 pm

Do I have to be punished like that to make you satisfied? wow…

59 Harrison Nguyen January 12, 2012 at 1:43 am

Well, I’d love to do that, so spoiled brat like you would know what liberty is really about

60 Careless January 12, 2012 at 11:39 am

His initial post was obviously a lie, so why ask that?

61 Nyk January 14, 2012 at 4:15 am

Scientists in the West are just about as likely to be honest on race differences in intelligence, global warming, or on any non-genetic explanations for homosexuality, as Chinese ones are on “Deng Xiaoping Theory”. Both groups will parrot their respective dogmas and anyone saying otherwise is to be ostracized.

62 Andrew' January 11, 2012 at 12:38 pm

The Chinese government would change it to “NOT(!) Produced under conditions of censorship and threat of career penalty.” and then we’d be even worse than where we started.

63 JWatts January 11, 2012 at 2:13 pm

I’m pretty sure putting a NOT in front of the statement doesn’t actually change the message. It just makes it humorous. Indeed, my recommendation is to just start out with the disclaimer: ‘Not produced under conditions of censorship and threat of career penalty!’ and see where it goes from there. 😉

64 Andrew' January 11, 2012 at 5:43 pm

At least it would be aspirational.

65 Edgar Webster January 11, 2012 at 12:40 pm

Lets re-phrase this:

“There is plenty of talk lately about ethics standards for economists. How about a new proposal? For anything in the social sciences written by a employee of a Koch brothers funded right wing think tank, there should be a disclaimer on the publication: “Produced under conditions of censorship and threat of career penalty.”

Hmmm?

66 GMU student January 11, 2012 at 12:49 pm

I totally agree. hahaha

It should also have “any student funded by those institutes and NGOs, maybe even including the Mercatus Center”.

67 CBBB January 11, 2012 at 1:12 pm

There really should be these types of disclaimers. A large chunk of social scientists are basically working as propagandists for one ideology or another.

68 Cliff January 11, 2012 at 1:41 pm

I bow to your awesome knowledge of the universe.

69 Andrew' January 11, 2012 at 5:44 pm

Or for us it would be “student NOT funded by X department”

70 dan1111 January 11, 2012 at 6:05 pm

Yep, the left and right are pretty much the same. You guys have a totalitarian government that controls the lives of 1.3 billion people; we have the Koch brothers.

71 GMU student January 11, 2012 at 6:11 pm

Shush, the left would feel insulted if you compare them with the right, vice versa…

72 the spam robots are getting better and better January 11, 2012 at 6:40 pm

Yea. The current Communist party in China is super leftist. I mean there is minimum wages, state healthcare and heavy environmental regulation all over China while punitive taxes on the 1% make sure that the top and the bottom of society are within 30% of each other. Oh wait…

73 dan1111 January 12, 2012 at 6:35 am

I’m really not interested in arguing that leftism = Communist China. However, some leftists seem to get defensive whenever China’s government is criticized. They seem to feel the need to bring up Koch brothers funding as if it is somehow equivalent a totalitarian government that imprisons dissidents. What is the deal with this?

74 an on January 11, 2012 at 1:14 pm

“The new socialist countryside” is the name of a rural development program of Chinese government, what’s wrong in citing the name? And what evidence do you have that it has not been a success? Actually, YOUR post is intelligence insulting.

75 CBBB January 11, 2012 at 1:16 pm

+100

76 Cliff January 11, 2012 at 1:42 pm

The post is pretty obtuse

77 Samuel January 12, 2012 at 1:02 pm

Holy cow, was Tyler’s post misleading. If I hadn’t seen this comment and then googled “new socialist countryside” I would have been left with the impression that Lin was a nostalgic tool. This is deplorable.

78 an on January 11, 2012 at 1:17 pm

Frankly, you know too little about what’s going on in China to have intelligent comments on it.

79 GMU student January 11, 2012 at 1:58 pm

Actually Tyler knows a lot about Sichuan food… lol

80 Andrew' January 11, 2012 at 5:49 pm

How much do you have to know to look at a vacant city, for instance, and point out that “shit, that’s a vacant city!”

At least he’s reading a book, and commenting on the book.

81 ian January 11, 2012 at 1:31 pm

Right-wingers in America: “Chinese centrally planned economy has failed pretty spectacularly in many ways. Also, they suppress dissent.”

Chinese: “Westerners know nothing of China! You criticize everything we do and are biased against us!”

Leftists in America: “Right-wingers bash your the collectivist aspects of your system reflexively and are wrong to do so.”

Right-wingers in America: “How can you leftists defend a government that actively suppresses dissent and smashes little peoples’ rights?”

This convo has played out approximately 1,000,000 times on the internet.

82 GMU student January 11, 2012 at 1:57 pm

exactly…hahahaha

83 JWatts January 11, 2012 at 2:17 pm

I think the strawman still has a limb left. You should take a few more swipes.

84 Bradley Gardner January 11, 2012 at 5:35 pm

Justin Lin has by far the strangest biography of any living Economist.

http://en.wikipedia.org/wiki/Justin_Yifu_Lin

85 JWatts January 11, 2012 at 9:10 pm

+1

86 Alan January 11, 2012 at 7:13 pm

For anything in the social sciences written by a citizen of China or an employee of an organisation funded by Koch brothers, or by someone with relatives living in China or employed by an organisation funded by Koch brothers, or by someone working in or for China or Koch brothers, there should be a disclaimer on the publication: “Produced under conditions of censorship and threat of career penalty.”

87 maguro January 11, 2012 at 7:32 pm

It’s always reassuring to know that the Supreme Leader’s latest Five Year Plan is succeeding.

88 Harrison Nguyen January 11, 2012 at 8:02 pm

“produced under the condition of censhorship and threat to jail” would be a more approriate disclaimer.

89 luosha January 11, 2012 at 9:21 pm

“Produced under conditions of censorship and threat of career penalty.”

I don’t think this is even the most likely explanation for a biased account. Nationalism, for example, can produce triumphalist accounts of what is going on. I find it insulting that you quickly assume that censorship and coercion is the most likely reason… it assuming a lack of agency analagous to treating someone like a child, or with unwanted pity. Fox News produces very skewed accounts of what is happening in America. But you would (i assume) give them credit for being people with different views from you, rather than assuming that they’ve been coerced.

90 So Much For Subtlety January 12, 2012 at 3:00 am

Censorship and coercion doesn’t have to be the reason Justin Lin writes what he does. But the fact that censorship and coercion are there colors anything that he writes. He does not need a policeman in his office to know that if he says the wrong thing in the wrong place, he will become an involuntary organ donor. Everyone in China knows this. And a whole series of smaller penalties from there down to his children being denied at place at a good school.

The fact that it is ever-present means that what Lin writes is different – unimaginable different – from what people in America write.

Fox News does produce different accounts. But we know they are not being coerced. They cannot be coerced. Lin can be. Any time. Even if he is not. He knows it. See the difference?

91 Careless January 12, 2012 at 12:02 pm

Yep, anyone who has seen a comment thread after a post that’s negative on China knows that the nationalists will be all over it with poorly reasoned defenses.

(this is both an agreement and some snark about comments in this thread)

92 luosha January 11, 2012 at 9:28 pm

I’ll just add that the disclaimer applies equally well if not better to everything that any candidate for political office says in America (and presumably in any democracy with a sophisticated campaign system involving PR people, handlers, etc.)

93 EM DC Economist January 12, 2012 at 9:45 am

Two points :

i) He is not the sharpest tool in the shed. That is well known.

ii) He is a Chinese bureaucrat. His career as an economist ending a long time ago.

So, except to get the official government position, why bother reading something he wrote – especially with regard to the Chinese economy ?

94 tim January 12, 2012 at 10:12 am

Has Tyler Cowen done any serious economics research in the recent years? It’s all too easy to insult an economist by typing a few words on his blog.

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