Automated Interlibrary Loan Notification, 30th Nov., 2010.

The library wrote to me:

Dear Matthew Dale,

A request you have placed:

Title: Hayeke he ta de si xiang
Author: Yin Haiguang

TN: 2842

has been cancelled by the interlibrary loan staff for the following reason:

Could not verify

We couldn't find the correct item with the information you provided.

I guess I can't request titles written in pinyin.

Public Attitudes in Hong Kong Towards Laissez-Faire, 29th Nov., 2010.

Over at EconLog, Bryan Caplan published an article titled "Hong Kong: Statist at Heart?"  He wrote:

"Public Attitude toward Laissez Faire in Hong Kong," a fascinating but overlooked 1990 paper by Lau Siu-kai and Kuan Hsin-chi (Asian Survey 30(8): 766-81, available on Jstor with subscription) shows this is just wishful thinking. Admittedly, the public in Hong Kong strongly supports the label of laissez-faire (literally translated as "noninterventionist economic policy"). When asked how they felt about the laissez-faire policy of the Hong Kong government, 1.8% strongly disagreed, 22% disagreed, 54% agreed, and 3.5% strongly agreed. I doubt you'd see numbers like that in the U.S.

But it turns out that Hong Kong's support for laissez-faire is only skin-deep. As soon as you ask people their opinions about specific interventionist policies - all of which, note the authors, "have either not been performed by the government or performed only very light or rarely," they show their true statist colors.

Hayek and Early Hong Kong Policy, 28th Nov., 2010.

After World War II, the average Hong Kong income was one-quarter what it was in Great Britain.  In 1961, John Cowpathwaite was appointed Financial Secretary of Hong Kong.  F. A. Hayek might as well have written his first budget speech.  He said, “In the long run, the aggregate of decisions of individual businessmen, exercising individual judgment in a free economy, even if often mistaken, is less likely to do harm than the centralised decisions of a government, and certainly the harm is likely to be counteracted faster." (Singleton 2006)

F. A. Hayek was discussing and writing about free markets at this time, but “it was Cowperthwaite who provided the textbook example showing economically liberal policies leading to swift economic development. His practical example provided confidence to the Thatcher and Reagan governments, and was a key influence in China’s post-Mao economic liberalization.”  Since the index on economic freedom in the world began in 1970, Hong Kong has ranked number one every year, and “No one deserves more credit for this lofty rating than Sir John Cowperthwaite.”

Milton Friedman called Sir John Cowpathwaite serving as Finance Secretary an “accident of officialdom.”  He mentioned the paradox that when “Britain was embarking on an extreme socialist policy in the homeland, one of its last remaining colonies, Hong Kong, was embarking on an extreme free-market policy.” (Gwartney 2006, pp. v)

Hayek in Hong Kong's Universities, 27th Nov., 2010.

I've been comparing the Mainland and Taiwan between 1920-1978, and then post 1978.  I would also like to include Hong Kong.

Trescott's book was good for information on academics in Taiwan, and I have found a few scholars in the Mainland.  But I have not been able to find information on F. A. Hayek's followers in Hong Kong universities.

It's probably because they only had one university before 1962.

[O:R]

Government Structures in China, 26th Nov., 2010.

Professor Shoulong Mao, of Renmin University, wrote, “China is a country with a long-standing tradition of the centralization of state power.  In this kind of country, any systemic innovation must gain high level approval.” (Mao 2010)

When making changes, there is the uncertainty between choosing slow, gradual reforms, or so-called “shock therapy.”  Observers looked at the immediate chaos of Eastern Europe after the fall of the Soviet Union, and have drawn their conclusions from that short period, still today.  However, “many Eastern European countries' standards of living are already very close to those in Western Europe,” and “the people of those countries, no matter in public policy or the commoners, all believe reform is a thing of the past, a sentence ending with a period.”  By contrast, the Chinese government is still debating “how the next Chinese economic reform should advance,” making the process “. . . a sentence ending in a question mark, still continuing.” (Chen 2009)

Theories on Economic Policy Reforms, 25th Nov., 2010.

Not all economic policies are guided by ideology, either for or against free markets or state planning. Studies on organizational change show that “. . . change generally is motivated by events in an organization’s environment—some problem or surprise . . . reveal[s] weaknesses in established strategies and processes, and thus provoke adaptation and change.” (Staudenmayer 2002, pp. 584)  This can be said of both organizations and governments.

A system based on centralized authority “has usually been found to be negatively associated with innovativeness.”  This stems from the generalization that leaders at the top “are poorly positioned to indentify operational-level problems, or to suggest relevant innovations to meet these needs.” However, once a decision has been formulated, centralization “may encourage the implementation of innovations, once the innovation-decision is made.” (Rogers 1995, pp. 379-380)

Hayek's Literary Work, 24th Nov., 2010.

F. A. Hayek wrote his first book, Monetary Theory and the Trade Cycle, in 1929.  He wrote four more books before 1941, covering prices, profits, and capital.  After his next book, The Road to Serfdom, his theories focused much more on the political implications of central planning.  His professor, Ludwig von Mises, continued the early focus on the economic effects of central planning.

In 1920, Ludwig von Mises had published “Economic Planning in the Socialist Commonwealth.”  In it, he argued “Without economic calculation there can be no economy. Hence, in a socialist state wherein the pursuit of economic calculation is impossible, there can be—in our sense of the term—no economy whatsoever.” (Mises 1990, pp. 14)  In 1935, F. A. Hayek, then a professor at the London School of Economics, felt compelled to edit the book Collectivist Economic Planning “by the fact that he found that certain new insights which were known on the Continent had not reached the English-speaking world.” (Ebenstein 2001, pp. 91)  This would lead him to become one of the main opponents of central planning in the English-speaking world during the 20^th Century.

[L:R]

Private Markets in North Korea, 23rd Nov., 2010.

In light of today's bombings, I thought I would post this article from the Washington Post:

As of May 26, the government no longer forces markets to close at 6 or 7 p.m., has dropped the rule restricting customers to women older than 40 and has lifted a ban on certain goods being sold. An official in the city of Pyungsung informed the Good Friends humanitarian group that the living standard had "drastically decreased since the currency exchange, and the government cannot provide distribution so they have to bring the market back up."

The Good Friends newsletter quoted the official as saying: "There are increasing deaths from starvation so opening [the] market is a reasonable resolution. Death due to starvation has gone out of control."

In the mid-1990s, amid a total collapse of the central planned economy, somewhere between 3 and 5 percent of the population -- perhaps 1 million people -- died of starvation. Meanwhile, North Koreans increasingly turned to small markets for trading and buying supplies.

Hayek in Hong Kong, 22nd Nov., 2010.

I contacted the Lion Rock Institute to ask them about the book "奥地利经济学派与香港经济初探 [Initial Research on the Austrian School of Economics and the Economy of Hong Kong]." They have offered to mail me a copy of both that book and an abridged version of the Road to Serfdom with commentary they wrote for a Hong Kong audience. And they aren't even asking me to cover shipping!

They are doing really wonderful things in Hong Kong. If you want to know more, their policy journal, Best Practice, is a fantastic read.

S. C. Tsiang's Influences Through the Decades, 21st Nov., 2010.

I'm currently reading an article by Professor Chun-sin Hwang of the National Tsinghua University. Its title is "蒋硕杰对奥地利学派自由经济思想的最后认同 [S. C. Tsiang's Final Approval of the Austrian Free Market School of Thought]." Even though S. C. Tsiang studied under F. A. Hayek, he was initially influenced heavily by Professor J. E. Meade's book, Planning and the Price Mechanism, the Liberal Socialist Solution.

The basis of that book was the belief that

"The middle way, which--for reasons which will I hope become clear--I have called the Liberal-Socialist Solution, must proceed by making full use of the money and pricing systems, but so controlling those systems that three fundamental conditions are fulfilled: first, that the total monetary demand for goods and services is neither too great nor too small in relation to the total supply of goods and services that can be made available for purchase; secondly, that there is a tolerably equitable distribution of money income and property so that no individual can command more than his fair share of community's resources; and thirdly, that no private person or body of persons should be allowed to remain uncontrolled in a sufficiently powerful position to rig the market for his own selfish ends." (pp. 11)

In the 1950s, S. C. Tsiang began to question the foundations of these principles. It wasn't until reading the literature of F. A. Hayek and Ludwig von Mises in the Socialist Calculation Debate did he completely reject socialism. I hope to finish the article later.

China, the Great Utopia, 20th Nov., 2010.

I immediately thought of Chinese socialism after I read the passage in The Road to Serfdom that discusses "the Great Utopia."

"That democratic socialism, the great utopia of the last few generations, is not only unachievable, but that to strive for it produces something so utterly different that few of those who now wish it would be prepared to accept the consequences, many will not believe until the connection has been laid bare in all its aspects." (pp. 36)

Hayek on the Development of the Rule of Law in China, 19th Nov., 2010.

In the Constitution of Liberty, F. A. Hayek wrote,

"I cannot speak with any competence about the interesting fact that the one great non-European civilization, that of China, appears to have developed, about the same time as the Greeks, legal conceptions surprisingly similar to those of Western civilization." (pp. 456)

Mises in China, 18th Nov., 2010.

Professor Hwang, of the National Tsinghua University, wrote on von Mises' influence on Chinese academics in his article "出版米塞斯巨著《人类行为的经济学分析》的当前意义 [The Immediate Significance of Publishing Mises' Magnum Opus, Human Action.]"

He believes Mainlanders are more eager for free markets and libertarianism, and points to the fact that many of the theory's leading books have only been published in jianti (simplified) characters. Ayn Rand's Atlas Shrugged was published in Chongqing before Taiwan.

Eureka! 17th Nov., 2010.

Back when I was in Beijing doing research on F.A. Hayek in China, one of the first articles I came across was an article on Bloomberg titled "Hayek, Once China's Poison, Is Now Its Prophet."

In it, Mr. Mukherjee wrote,

"Full of poison,'' is how a Chinese introduction described his 1944 book 'Road to Serfdom,' which was made available to high-ranking communist cadre to acquaint them with the 'enemy's' thinking, according to William McGurn in the 2000 book 'China's Future: Constructive Partner or Emerging Threat?'

I thought it was a lead, but then I did some research and found out William McGurn is not the author of the book China's Future: Constructive Partner or Emerging Threat?  (Maybe he contributed?)  I sent the author of the Bloomberg article an email, but it bounced back.

I asked an American friend of mine that works for the Atlas Economic Research Foundation.  The Atlas Economic Research Foundation is a non-profit organization "connecting a global network of free market organizations and individuals to the ideas and resources needed to advance the cause of liberty."  He said the book sounded too good to be true.

I kind of gave up looking for it.  But then during a dinner conversation with some friends from Sohu Business, one of my friends mentioned in passing that she had read The Road to Serfdom as a kid at her uncle's house.  He was a lawyer high up in the party, so he had access to a lot of material.  She laughed, and said every sentence had a sentence following it, explaining why the previous sentence was wrong.

I then asked Professor Feng, at the Chinese Academy of Social Sciences, if he knew of it.  He said he had it somewhere, but "had a lot of books."

Today I found out it exists.  I was searching for the Chinese name I was used to "通往奴役之路" ("To lead to the road of slavery").  It turns out the name is "通向奴役的道路" (Leading to slavery's road.)

Hayek and the New Youth Movement, 16th Nov., 2010.

Yong Xie writes in his article "胡适的直觉 [Shi Hu's Intuition]," that Shi Hu (the leading intellectual of the New Youth Movement) recommended  Shuojie Jiang, Dazhong Liu, and Jingchao Wu as economic advisors to the Nationalist Government.

Shuke Zhang, in a related article titled "胡适的蒋硕杰 [Shi Hu's Shuojie Jiang]," writes Shuojie Jiang was "consistently against inflation, against economic control, and artificial interventions in the market.”

Now that I'm starting to figure out the names of these people, the network of Hayek supporters in China keeps growing. 

Class Schedule, 15th Nov., 2010.

Here's my class schedule for next semester:

BUS 459-01 Business Policy and Strategy for B.S. Majors

BUS 457-01 Strategic Issues in Global Business

BUS 240-01 Business Law

BUS 499-01 Hayek in China

Money, Banking, and the Federal Reserve, 14th Nov., 2010.

If the video doesn't work, please view here.

Fear the Boom and Bust, 13th Nov., 2010.

Types of Reform, 12th Nov., 2010.

I read the article I found yesterday.  The concluding paragraph was the most interesting.

"Lastly, in regards to the route taken during Russian and Eastern European privatization, there have been a lot of misunderstandings.  As for the results of the so-called "Shock therapy," I think too many academics still make their conclusions from the conditions in the mid- to late-90s.  There hasn't been anyone today that has gone back to Eastern Europe and looked around, seen the difference between today's Eastern Europe and the Eastern Europe of the 90s.  Recently I was discussing gradual reform versus shock therapy with an Eastern European academic.  He said that in Eastern Europe this is not an issue, because reform there has already finished completely.  Not only that, but many Eastern European countries' standards of living are already very close to those in Western Europe.  For example, the countries that were split up, such as Czechoslovakia, Yugoslavia, and the Soviet Union, the people of those countries, no matter in public policy or the commoners, all believe reform is a thing of the past, a sentence ending with a period.  By contrast, how the next Chinese economic reform should advance is still a sentence ending in a question mark, still continuing.  Therefore, to say "Eastern European reform has been a failure, but Chinese gradual reform is a success," does not stand on its own.  One has already finished, but the other is still underway. What is China's next step?"

The Pew Research Center has more on these attitudes.

Receptiveness, 11th Nov., 2010.

Right now I'm working on an article called "中国经济模式转型的挑战 [The Challenge of Transformation in the Chinese Economic Model]."

The introduction to the article caught my eye: "This article was presented on May 23rd, 2009 at the Chinese Communist Party Central Academy Graduate School. An edited version appeared in the Economic Observer Post on July 6th, 2009."

It seems to have a lot on the process of reform.

A party school.

Downward Diffusion, 10th Nov., 2010.

In an earlier post, I wrote on Rogers' research on innovation in centralized economies.  This assertion is supported by Professor Shoulong Mao's article on the 村民自治与民主政治的制度演进［Systemic Evolution of Rural Autonomy and Democratic Politics］.

"China is a country with a long-standing tradition of the centralization of state power.  In this kind of country, any systemic innovation must gain high level approval.  China's rural-level democracy developed under the support of high level leaders.  High level leaders, especially the hard work and dedication of [Chairman] Peng [of the Standing Committee of the National People's Congress], are the key element to the initiation of basic Chinese democratic development.  (The construction of the Chinese market economy also started like this.)"

Land Reform in Taiwan, 9th Nov., 2010.

I read further into Professor Wu's book on economic transformations.  There were similar currents running through economic reforms in Taiwan and the Mainland.

The first was that both Leninist parties, the KMT and the CCP, had complete control over their respective domains.  The CCP had just vanquished the Japanese and the KMT.  Those not loyal to General Chiang did not follow him to Taiwan. (Page 141.)

"On the one hand, the KMT monopolized political power at the national level, suppressed dissent, controlled the mass media, and preempted social organizations that might constitute bases for opposition. On the other hand, the party-state paid utmost attention to improving the material well-being of the population and considered economic performance the ultimate source of legitimacy for the regime." (Page 142.)

"The party-state monopolized political power because presumably it knew what was best for the country and needed concentrated authority in order to overcome obstacles when implementing its policies. Economic reform thus advanced much faster than political reform. People were asked to accept the enlightened rule of the technocrats, backed by the supreme leader, because by so doing they could expect economic prosperity in return." (Page 144.)

"Reform began in agriculture, through different approaches were used in the two cases. In Taiwan, a land reform eliminated the traditional landlord class and redistributed lad to the tillers. On the mainland, the state decollectivized agriculture and allotted land among peasant households. The results were similar. Both reforms created a large number of peasant proprietors farming smallholdings. The production motive was maximized as income power was transferred to individual producers. As it turned out, the land reform laid the foundation for Taiwan's rapid economic development over the following four decades, and the restoration of family farming intitiated the whole reform process on the mainland in the 1980's." (Page 147.)

Speaking of accidents of history, the Lion Rock Institute, Hong Kong's leading free-market thing tank, has been providing support for this project.

Chinese Literature on Hayek, 8th Nov., 2010.

I searched the National Library of China's catalog for "Hayek."  It came up with 107 results.  I was surprised by the number of Masters and Ph.D. theses they had on Hayek, written in the last five years.

Professor Zhenglai Deng, of Fudan University (Shanghai), seems to have the most work published.  The publishing houses are interesting; Peking University Press, Jiangxi People's Press, Shandong People's Press, Hebei University Press, Fudan University Press, Intellectual Property Press, etc.

I'm told that many university publishing houses will publish or translate work that no one on the faculty cares about or really understands, simply to make their publishing record look better.  So I will be careful to only focus on reliable authors who add to the debate.

While doing this research, I have noticed a minor linguistic difference, but which could be key to my research.  That is, the difference in the transliteration of F.A. Hayek and Carl Menger's names into Chinese.

As you can see, the Mainland names are closer to the English spelling of the name, but the Taiwanese names are closer to the English pronunciation.  This tells me that Taiwanese and Mainland scholars' exposure to the Austrian School of Economics came from different sources.

Innovation in the Market and under Central Planning, 7th Nov., 2010

I thought I’d focus on the causes of change within a society.  Mainly, why do countries change their economic system?

Two reasons came to my mind.  The first is deteriorating conditions, such as lower standards of living or outright starvation. The second is comparison between living conditions between economies, or in other words: keeping up with the Joneses.

This may explain the background behind the People’s Republic of China and other Chinese societies that have chosen more market-oriented economies, such as Hong Kong, Singapore, and Taiwan.

However, this correlation would not be as strong in a closed, authoritarian country.  This theory does not hold up when compared to North and South Korea. (All data from Maddison, 2003.)

I borrowed Comparative Economic Transformations: Mainland China, Hungary, the Soviet Union, and Taiwan by Yu-shan Wu from the Armacost Library.  The key question he/she (?) asks is “What causes an authoritarian regime that fully controls a society to restructure its economy?” (Page 2.)  The three principles of Roman Law are considered in defining property rights, the foundation of an economy. (Page 4.)

1. usus (the right to use the thing)
2. fructus (the right to the proceeds of a thing)
3. abusus (the right to dispose of a thing)

Usually, command economies have transitioned to either market socialism or state capitalism.

“[T]hree historical cases stand out as offering the greatest potential for making comparisons with the PRC in the area of restructuring industrial property rights: Hungary in the late 1960’s and the 1970’s, the Soviet Union in the late 1920’s, and the Republic of China (ROC) in Taiwan in the 1950’s and early 1960’s. [ . . . ] Each had experienced a major liberal institutional change in agriculture before making the critical decision to reform is property rights structure. In Hungary, it was a marketizing reform in agriculture that followed the completion of the recollectization drive of the 1960’s. In the Soviet Union, it was the shift from requisitioning under War Communism (voennyi kommunizm) to a single tax in kind under the New Economic Policy. In Taiwan, it was the “land-to-the-tiller” reform of the 1950’s. In the PRC, similar changes were made in agriculture under the household responsibility system. The causes of these agricultural reforms are similar: the desperate desire of the elite to boost regime legitimacy by radically changing property rights structures in order to motivate peasants to increase food production in the aftermath of a major national disaster. The suppression of the 1956 popular uprising and the recollectivization campaign in Hungary, the catastrophic civil war and War Communism in the Soviet Union, and the effects of land reform in mainland China and the squashing of a serious local rebellion in Taiwan forced the ruling elite in each country to take drastic measures to assure that the most basic needs of the population were met. This was also the case in the PRC, which introduced agricultural reform in the aftermath of the disastrous Cultural Revolution decade.” (Page 12-13.)

This brings me to the next book that I am consulting: Diffusion of Innovations by Everett M. Rogers.  In it, diffusion is defined as “the process by which an innovation is communicated through certain channels over time among the members of a social system.” (Page 5.) The four main elements in the diffusion of innovations are “the innovation, communication channels, time, and the social system.”

Discussing centralization, Rogers writes,

 “Centralization is the degree of which power and control in a system are concentrated in the hands of relatively few individuals. Centralization has usually been found to be negatively associated with innovativeness; that is, the more that power is concentrated in an organization, the less innovative the organization tends to be. The range of new ideas in an organization is restricted when a few strong leaders dominate the system. In a centralized organization, top leaders are poorly positioned to indentify operational-level problems, or to suggest relevant innovations to meet these needs. Although the initiation of innovations in a centralized organization is less frequent than in a decentralized organization, the centralization may encourage the implementation of innovations, once the innovation-decision is made.” (Page 379-380.)

Sounds like Reform and Opening.

Hayek's Relevance in China vs. the West, 6th Nov., 2010.

The title of an article I found, 哈耶克的“自发社会秩序”理论与中国经济改革的思路选择 [Hayek's "Spontaneous Order" Theory and China's Economic Reform Ideas and Choices] by Sen Wei (韦森), looked promising. However, most of the article focused on the philosophical background, i.e. the Scottish moral philosophers, of Hayek’s work.  The only concrete sentence about Hayek and the Chinese economy was:

The achievement and glistening historical path of the Chinese economic reforms, especially the huge success of early-stage rural reforms, to an extent can be considered a confirmation and development of that which clearly came out of the logical background of Hayek’s spontaneous order.

The author received his Ph.D. from the University of Sydney, and is now a professor of economics at Fudan University.  In 2009, he gave a speech at the Academic Seminar on Professor Zhenglai Deng’s (邓正来) New Book on Hayek’s Theories of Liberalism.

Nobody should think that Hayek’s influence in the West is very big. Currently, there are more people in China that know about Hayek than there are in the West.  Also, a lot of students of Western academic circles say Hayek is hard to understand.  I’ll give you an example: Hayek’s last book, The Fatal Conceit, was published in 1988.  I went back to the University of Sydney in 2001 and borrowed the book.  When I was reading it, I discovered the book had been there for two years, and only two people had borrowed the book. One of those people was myself.  One time, the former president of the University of Chicago College of Law, Saul Levmore, visited Shanghai.  He asked me what I was researching, I said “I’m studying Hayek.”

He said “Oh, studying Hayek! It’s very hard to understand him.”

It’s harder to discuss Hayek’s thoughts with foreign economic circles.  Even Hayek, himself, recognized this. During his later years, at the Bartley lectures, he said, referring to economic studies, “I’m an outsider.”

It doesn’t matter if the majority of foreign academics accept and understand Hayek, or not, because without a doubt, Hayek is one of the 20th Century’s greatest thinkers. This point we certainly need to remember.

I borrowed The Fatal Conceit and Collectivist Economic Planning from the Armacost Library.  The Fatal Conceit has been checked out four times in the last five years (including myself), and the last time Collectivist Economic Planning was checked out was in 1998.

John Stossel blogged on Thursday that he will confront the New York Times over it’s referencing of Hayek's writings as “long-dormant ideas,” in a class of “once-obscure texts by dead writers.”

He quotes David Boaz’ piece on Cato@Liberty,

So that's, you know, "long-dormant ideas" like those of F. A. Hayek, the winner of the Nobel Prize in Economics, who met with President Reagan at the White House, whose book The Constitution of Liberty was declared by Margaret Thatcher "This is what we believe," who was described by Milton Friedman as "the most important social thinker of the 20th century" and by White House economic adviser Lawrence H. Summers as the author of "the single most important thing to learn from an economics course today," who is the hero of The Commanding Heights, the book and PBS series by Daniel Yergin and Joseph Stanislaw, and whose book The Road to Serfdom has never gone out of print and has sold 100,000 copies this year.

He didn’t mention his influence on China.  I guess that’s why this is a good topic for my Latin Honors.

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."

The I, Pencil Institute and Weiying Zhang, 4th Nov., 2010

Yesterday I printed out some articles from the 铅笔经济研究社 (I, Pencil Economic Research Institute).  I searched through their recent articles, and selected the ones that had to do with Dr. Weiying Zhang (张维迎) or the Austrian School of Economics.

Here is a summary of the ones I read and any information relevant to my research:

1.《市场的逻辑》读书会简记 [Notes on The Logic of the Market's Study Group]

Mr. Xinhua Deng (邓新华) wrote about the small gathering held to discuss Professor Zhang's book, The Logic of the Market.  Professor Zhang's premise is that "If you want to be wealthy, you have to make others wealthy. If you cannot make others wealthy, you will not profit, and so you have no way of being wealthy. That's the market. The government, without caring about the wealth of others, can make itself wealthy."

If you speak Putonghua, and are interested, you can watch Mr. Deng's interview with Professor Zhang on Yijian Zhongguo.

2. 在黄昏时孤独起飞 [Dusk is Solitary]

Ms. Yuxuan Xu (许宇萱) writes,

Weiying Zhang is solitary; today, those people that once were his comrades-in-arms have all turned into his opponents.  When they all turned to Keynes, turned to "the market, overall, is good, but sometimes needs the government's guidance," kind of interventionism, Weiying Zhang was the only one to hold on to his faith in the market.

3. 张维迎的卓越 [The Outstanding Weiying Zhang]

Professor Zhang was only in his 20s when he put forward the dual-track price system, which was implemented and allowed the market price to co-exist with the centrally-planned price, which allowed a slow transition toward free market pricing.  

He is one of the highest avenues for the Austrian School of Economics in China.  At the 2009 China Entrepreneurs Forum, he presented his speech "Bury Keynesianism."  The original speech is hosted on Sina Finance, and someone at the Mises Online Community has translated it.

4. 如果政府像这个国王该多好 [It Would Be Better If The Government Were Like This King]

Mr. Xinhua Deng quotes Professor Zhang Weiying as saying "If a policy's direction is the same as the market, that means it has no function; if the market and the policy run in opposite directions, it will be counter-active."

Hayek in China Launch.

Purpose:

The purpose of these posts will be to document the progress of my Latin Honors project: The works of F.A. Hayek and his influence on China.

Background:

I am a senior Global Business major at the University of Redlands, in California.  In May, 2009, I left for China, and studied abroad there for 15 months, with IES Abroad.  During my last semester (Summer, 2010), I undertook a research project on the Austrian School of Economics in China.  I was quite surprised, and delighted, by the results.  I am continuing this research in my Latin Honors.