S. C. Tsiang and Taiwan, 5th Nov., 2010.

Today I read a rather long article on S. C. Tsiang (蒋硕杰). The article was written by Professor Chunsin Hwang (黄春兴), of the National Tsinghua University (Taiwan).  I contacted him while I was doing this research in China, and he was very helpful.  He learned the Austrian School of Economics from S. C. Tsiang while he was a graduate student at the National Tsinghua University.  He later got a Ph.D. from the University of Rochester.  He is now an associate professor of economics at the National Tsinghua University.  Interested students can enroll in his course, ECON 6171 The Economic Theories of the Austrian School.

According to him, "Before economic reform and opening-up, Austrian ideas were the main topics attacked, distorted, and criticized by communists. After opening-up, most Chinese scholars who read [the Austrian School] emphasized its political philosophy, not economic analysis."

In 2008, he published an article with the 九鼎公共事务研究所 (Cathay Institute for Public Affairs), titled "奥地利学派对蒋硕杰经济思想的影响 [The Influence of the Austrian School on S.C. Tsiang’s Economic Ideas]."

The first paragraph makes an excellent point, which I translated as "During Taiwan's process of development during the last 60 years, it was first economic affairs that were liberalized step by step, then it expanded to political affairs.  This verifies a long standing and common belief of traditional liberals: Only after economic liberty takes root can political liberty have a stable and continuous development.  Therefore, any discussion about the Taiwanese opening up of political liberalization in the 1980s should not overlook the liberalization process of foreign exchange and interest rates that started in the 1950s.  At that time, Mr. Tsiang explained economic liberty's most important people.  He has become an extremely important topic for his contribution to the inheritance and evolution of liberal economic thought, as well as the understanding of Taiwan's process of liberalization."

The article then goes into S. C. Tsiang's opinions on Walras' Law, D. H. Robertson, time dimension, currency, boom and busts, and industrial policy.  Even though 'Hayek' and 'Austrian Economics' do not appear in the index of 蒋硕杰先生悼念录 [The S. C. Tsiang Memorial Collection], Professor Hwang believes "S. C. Tsiang's discussions on the misapplication of Walras' Law, opposition to government created credit expansion, and persistence on currency theory adapting the use of analysis method are all based on the foundation of Austrian Time Dimension theory."

Unfortunately for the Chinese Austrian School, he didn't stay in China.  According to his New York Times Obituary, he "[R]eturned to China briefly to teach and work in the Chinese Central Bank. When the Communists came to power in 1949, Professor Tsiang fled to the United States, where he joined the International Monetary Fund. [ . . . ] In the 1960's, he was a professor of economics at the University of Rochester. In 1969, he joined the faculty at Cornell and remained there until retiring in 1985. He was a pioneer in the theory of money flows and exchange-rate markets."