Unirule Master Thoughts Class(2014) 1st Session Held in Beijing
Author:Unirule
Time：2014-12-23 14:14:38 Clicks:
November 8th to 9th, the first session of “Unirule Master Thoughts Class(2014)” was held in Beijing. This session was gracefully joined by Professor ZHANG Weiying from Peking University, and Professor QIN Hui from Tsinghua University.
On November 8th, Professor ZHANG Weiying spoke on two topics, namely, “Power of Ideas”, and “Entrepreneurship and China’s Economic Transition”.
Professor ZHANG Weiying though the presumption of traditional economics- i.e., human behaviors are determined by interests- is not exactly right as one’s opinions, beliefs, and consciousness can influence one’s behaviors. In the meanwhile, he pointed out that the social changes were not about one interest defeating the other, but one ism replacing another, that is to say, the triumph ideas. Taking China’s reform as an example, Professor ZHANg pointed out that the effect of the reform depended on two factors, one was leadership, the other was ideas. The right reform requires strong leadership, but what comes first was the right idea. Otherwise, reforms could lead to further distraction. Therefore, Professor ZHANG emphasized the “market place for ideas”, and that only with a free market place for ideas would there be a real prosperous society.
In the afternoon session, Professor ZHANG analyzed three existing economic growth patterns, and proposed that “the core of economic growth was entrepreneurs”. Professor ZHANG defined two fundamental roles played by entrepreneurs, i.e., to discover and to create non-equilibrium.To discover non-equilibrium means “arbitrage”, which includes intra-market arbitrage, inter-temporal arbitrage, and the arbitrage between the factor market and the commodity market. What creates non-equilibrium is innovation of products and business models. Professor ZHANG pointed out that the majority of Chinese entrepreneurs were still in the stage of “discovering non-equilibrium”, and the future for economic transition would bring about more innovative entrepreneurs that were able to “create non-equilibrium”. This was also the true driving force of China’s economic growth.
On November 9th, Professor QIN Hui spoke on “The Dilemma of Globalization in the 21st Century”. Professor QIN pointed out that there was a phenomenon of “asking the horse to run fast without allowing the horse to get fed” in modern democratic countries(especially in the so-called welfare states). Parties had to please the constituents in order to get elected. The leftists could only increase welfare without waging more taxes, and the rightists could only reduce taxes without reducing welfare. This phenomenon resulted in the increase of government debts and policies that benefited the constituents. This was also the critical reason for the economic crises in Europe and US.
Of course, there is a corrective mechanism for democracy which should have prevented the debts from expanding indefinitely. However, Professor QIN pointed out that it was very likely that the debts could expand even further, because there was another type of states in the world. The policies of such states features the opposite of those of the democratic counties. In these countries, as there was an advantage of less developed human rights, the tightening and the loosening up of policies would benefit the ruling class, instead of the common citizens which resulted in the accumulation of money of the government. Such countries are paying for the high welfare and debts of democratic countries.
