Highlights
Contracts before Law, Common Law before Statutory Law
by SHENG Hong, Director of Unirule Institute of Economics
Translated by MA Junjie, Researcher, Unirule Institute of Economics
I intended to speak after Professor Steven N.G. Cheung as I thought his theories, insights and the following discussion were very important and fundamental. One of his key contributions to the economics is his well-known “Steven Cheung's Demand Curve”, a critical innovation in economics, which I believe, will be included in mainstream textbooks soon. What he proposed was Say's law on the macro level. Say’s law of markets stipulates that supply creates demand automatically, or supply itself creates demand. It basically means that if the supplied products are sold out, income will come about, and this income is demand in essence. This is built upon a premise that there is an effective market. Professor Cheung added a mirrored demand curve in the original supply-demand chart, and he took this mirrored curve as the new supply curve, i.e., your demand decides the amount of supply, and what you provide is for the sake of demand. He said this is an upgrade of Say’s law. These two curves are completely symmetric. This innovation bears great significance. And he says that this applies to every man, that a person supplies the same amount as he or she consumes. Everyone earns to spend, and the more time it takes for you to consume, the higher your cost is. When this time cost amounts to a certain level, you’d stop consuming as you feel the time cost is harming your leisure time. This is a very important discovery.
Of course, when Professor Cheung discussed this, what he stressed was that the effective market is a premise. This theory only stands when there is an effective market. When this market is compromised, it won’t work. Therefore, Professor Cheung also said that “the market price is a price without rent dissipation,” that the market price is a price reached in the market transactions without efficiency loss. Therefore, when we talk about this issue, we also presume that the market is effective, which depends on whether transactions are freely undertaken, and whether people are free to enter into contracts and agreements. Therefore, what I understand from Professor Cheung’s criticism of the current Labour Contract Law is that this law interferes with people’s freedom to enter into contracts, which raises transaction costs and results in an ineffective market. This is a very important point indeed.
I think this way of reasoning can be extended. As we know, a market is in essence a habit, and a collection of contracts. That is to say goods and services are exchanged in the market. But we are also aware that human behaviour goes beyond exchanges of goods and services. We have contracts, and we have habits. In a more general sense, let’s ask what is a habit? A habit is about people’s exchange behaviours, that is the exchange of people’s behaviours. This habit only comes into being through long-term human interaction, or in the economic term, through repeated games. What do these repeated games lead to, then? To an equilibrium. As long as the game parties are free and without external interference, these repeated games will inevitably lead to an equilibrium, an effective one. What I mean is that habits are effective, just like contracts are effective. On the other hand, when this habit is interrupted, or when contracts are interrupted, deviation from the equilibrium will be the result.
Let’s get back to the Labour Contract Law. Labour Contract Law is an odd combination. We all know what a contract is, namely an agreement reached by all parties of economic activities voluntarily. As for laws, they are coercive regulations. Why should these two words be put together? Does it mean “coercively reached voluntary agreement”? That’s absurd. When we read the text, apparently a lot of endeavours have been taken to draft it. However, as for details, this law is seriously flawed. In addition, it turned many voluntary articles that are supposed to be reached by both parties into compulsory articles. This law, therefore, dictates from the essence of contracts. What is the problem, then? I believe it is attributed to the misunderstanding of law in the modern times. In China’s modern history, modernisation of this country took a very extreme form, that is denial of traditions and habits, recognition of lofty and meta-physical theories and imposition of it on the Chinese social orders. This is a severe issue, which resulted from intellectuals’ misunderstanding of law.
When we talk about the rule of law, we should realise that there is broad and narrow understanding of this phrase in the Western background. When Montesquieu talked about law and the “spirit of the laws”, he didn’t mean the statuary law, but rules and general codes of conducts, or in the Chinese cultural equivalent, Dao. However, when this rule of law was translated into Chinese, it is narrowly understood as the rule of statuary law, which is a big mistake. That’s why nowadays many people put laws before habits and contracts, since laws are drafted and enacted by the authorities, and they are superior to rules that emerged among the people.
In addition, many people believe that coercive statuary rules are better than and superior to voluntarily abided rules, which is another huge mistake. They misunderstand the process for laws to be drafted. The origin of laws is contracts and habits, not the other way around. Contracts and habits should not be overruled by legislative bodies. Therefore, in China’s legislative practice, contracts and habits are usually overlooked, and the legislative power only resides with the legislature. But the question remains, is our legislature more effective than the common and long-term practice of rules and habits? I don’t think so. Firstly, legislatures are more coercive; secondly, they practice representation rather than direct participation; and thirdly, the legislature lacks the experience of people in economic activities. I believe the laws made by the legislature do not necessarily supersede habits and contracts. However, this is a fact of Chinese characteristics.
As we see in the history of global social order development and laws, there is no exception that statuary laws are a result of contracts and habits. In traditional Chinese culture, Li (rules) comes before Fa (laws), because Li is the so-called habits. These habits are more effective. Besides, Li is not compulsory. A society should pursue non-compulsory rules, instead of coercive and compulsory ones.
Another example I’d like to refer to is Britain’s common law tradition. The British common law tradition comes from habits, from the civil society, and acts as standard for judicial cases. In the 12th century, the royal court collected habits and rules people were used to across the country and made them useful as standards for judicial prosecution. In the meantime, royal judges gathered in Westminster to discuss and debate in order to establish some fundamental rules. A very strong and still relevant trend in the UK is that they believe common law is superior to statuary law, and that common law is superior to constitutions. This sounds hard to believe to a Chinese ear, however, it exhibits the due legal procedures, and how law developed over time.
Coming back to the Labour Contract Law, we find a very serious problem. This law has overlooked various contracts and spirits of contract, which emerged in China’s civil society over a long period of history. For a superior statuary law, a state law, this is unacceptable. It lacks several principles established in the society through the practice of countless voluntarily reached contracts, and it excludes the difference across regions and the diversity of local habits. By doing so, the exploration of better forms of law and better practices of habits and rules is interrupted.
Therefore, I think the biggest mistake concerning the Labour Contract Law is not in the texts or details of the law, such as the minimum wage stipulation, or the restriction of open-ended contracts. It concerns the principles of this law and the reasoning behind it. If any amendments are to be made to this law, I wish they wouldn’t be detailed articles or clauses. The Labour Contract Law, as compulsory as it is, should guarantee transparency and an environment where the contract parties are in equal positions, instead of stipulating detailed practices which are better left to the parties of the contracts. In the interaction between the employers and the employees, details of the contract will emerge as a result of compromises and negotiations. As Professor Cheung said, employers tend to provide minimum wage and worse conditions for employees, but they have to come to terms with higher wage and better working conditions because of competition for employees. Therefore, I think we should trust employees to be rational and the market to be effective. One thing we can do is to collect different labour contracts, and analyse them in order to find the rules, which they have in common. I was reading Mr. LIANG Zhiping’s Common Law in Qing Dynasty where he mentioned that there have been texts and anthologies of various contract texts ever since China’s Tang and Song dynasties, and the many reasonable elements were therefore extracted from these texts to form official stipulations to guide people’s behaviours, and these stipulations were not compulsory.
Therefore, I think we should improve the legislation from the perspective of guiding principles, which may give us better laws. And this should also be commonly practiced in other laws. The Labour Contract Law should serve as a valuable lesson for better legislation.
（This article presents remarks made by Professor SHENG Hong at the Seminar on “Labour Contract Law and Supply Side Reform” held at Unirule Beijing Office on July 23rd, 2016.）
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Current Events
What Happened to China’s Private Enterprises— 2016 China Private Enterprises Survival and Development Forum Held in Beijing
As the latest statistics shows that investment by private enterprises has slowed down sharply for the first half of 2016, concerns over the private sector keeps mounting. In light of this, a forum on “What Happened to China’s Private Enterprises” was held at Unirule Beijing Office. Famous economists and lawyers attended the forum, including, Mr. MAO Yushi, Honorary President of Unirule; Professor ZHANG Shuguang, Chairman of Unirule Academic Committee; Professor Ningyue from Chinese Academy of Social Sciences; famous lawyer Mr. CHEN Youxi; Mr. WU Si, President of Unirule; Professor YAO Zhongqiu from Beihang University; and Professor LI Weiguang from Tianjin University of Finance and Economics.
In the opening speech, Mr. MAO Yushi quoted John Locke and said that property should not be public owned, and power should not be private owned. He thought the only solution to China’s current economic conundrum was to start with the public ownership of private property and the private ownership of public power. He admitted that Unirule had always been concerned with the development of private enterprises, but Unirule’s capability was limited. However, it stood up anyway to do things right.
Mr. CHEN Youxi explained how the private enterprises were faring from legal cases. He thought as the law system became more and more explicit, the Chinese society was losing its vigour. In the past, legislation was thought to be better implicit instead of explicit. In the past 20 years, more and more legislation have taken a different guideline where they became more and more explicit, leaving little room for manoeuvre. Thanks to this, any reform moves could be halted due to breach of laws, depressing the economic development to a large extent. (To read more.)
Research on Seeking China’s Constitutional Review Breakthrough Released in Beijing
On the afternoon of August 17th, a press release of Research on Seeking China’s Constitutional Review Breakthrough was held at Unirule Beijing Office. Professor YAO Zhongqiu from Beihang University and leader of the research team introduced the research and its findings. Mr. JIANG Su introduced the content of the research.
Mr. CHEN Yunsheng from Chinese Academy of Social Sciences; Professor ZHANG Qianfan from Peking University; Professor SHENG Hong, Director of Unirule; and Professor XIE LIbin from China University of Political Science and Law commented on the report. They thought the research was solid and reflected the incremental approach of the researchers which constituted the feasibility of the research. They also pointed out several aspects that should be improved.
Mr. JIANG Hao, executive leader of the research hosted the press release.(To read more.)
Seminar on “An Estimation of the New Economy’s Contribution to Economic Growth” Held in Beijing
The Chinese economy has made great progress since the Reform and Opening-up. However, the factors that contributed to the rapid growth in the past three and a half decades are waning in influence, such as the population dividend, the institutional reform dividend, and other technical innovations and technical advances. The next phase of China’s economic development should focus more on internal, innovation-led, and structure reforms. This seminar was held on September 27th, at Unirule Beijing Office. Several experts including Professor SHENG Hong, Director of Unirule; Professor YAO Zhongqiu from Beihang University; Mr. LIANG Chunxiao from Ali Institute,; and Mr. WANG Junxiu from Institute of Scientific and Technical Information of China attended this seminar.
From the perspective of price and transaction cost, Professor SHENG Hong thought online retail was able to lower transaction cost, in the form of commercial transaction cost and that of consumers, and therefore, changing the lowered transaction cost into new sails revenue. In this way, the increase of online retail could contribute to the GDP growth. Professor SHENG Hong also introduced his methodology of estimating online retails’ contribution to the GDP growth.
Mr. LIANG Chunxiao thought there were three aspects of the New Economy’s contribution to growth: the first was price elasticity, as the prices lowered, transactions increased; the second was the expansion of the market as more commodities were transacted; and the third was that there were more buyers. He also pointed out that the infrastructure of the New Economy was of key importance, such as Cloud computation, the mobile Internet, and the smart end devices.
Mr. WANG Junxiu separated the New Economy into two parts, one was the old information-based economy, and the other is the new information economy that was driven by data. What characterised the latter was its strong penetration backed by the immense data. And this type of economy has become the main part of the New Economy. (To read more.)
News
Unirule 10-D Spatial Simulation Planning Model (SSPM)
The Unirule 10-D Spatial Simulation Planning Model (SSPM) is a mathematical and computational model based on economics. It is developed by a Unirule research team led by Professor SHENG Hong. SSPM is designed to simulate the development scale, economic density, industry distribution, resource constraints, ecological preservation, institutional influence, policy effect, and the evolution process in the next ten to twenty years or even longer period for a region. SSPM provides reference for the regional economic development strategy making, which can be directly adopted in the planning on regional economic development, population, land use, industry development, townships, water and ecology.
So far, SSPM has been adopted in the industry planning of Qianhai Area, Shenzhen, and the economic development planning of Yangcheng County, Shanxi Province.
Learn more about the SSPM
Current Researches/ Consulting
Improving China’s Implimentation and Supervision Institution of the Constitution
At present, research on the implimentation and supervision institution of China’s constitution is insufficient. Multiple problems exist in the current studies, such as the lack of a cultural perspective, and empathetic understanding of China’s political tradition; a lack of authentic Chinese perspective and an indulgence of Westernized framework of analysis; and a lack of reflection of the reality and the existing political framework.
The research on China’s constitution review institution should put the protection of civil rights and constitutional construction first, with a reflection of China’s reality and take in the advantages of external researches. A plausible research approach is as follows: 1. This research ought to provide a right relief mechanism; 2. It should take into account that China is a vast country with imbalanced regional development realities which foster unique and differentiated conceptions of the law and politics in general; 3. It should be built upon the current constitutional structure and take into account the interactive system of the power of the party, the National People’s Congress, etc. in order to make it a progressive research, which can enable the elements of constitutionalism to supplement the current constitutional framework; 4. Scrupulous examination should be given to constitutional practices in other regions and cultures, especially those influenced by the Chinese culture or with a similar institutional set-up, such as Taiwan and France; 5. Observations should be made in regard to the traditional Chinese institutions, such as the institution of the expostulation system (“谏议制度”, or giving advice), supervision system, and the institutions established in this light, e.g., Taiwan’s Control Yuan.
Improving Entrepreneurs' Survival Environment: Abolishing Death Penalties in Relation to Fund-Raising Cases in China
In recent years, environment for private enterprises has been taking a deteriorating turn, which attracts attention from the media and the academia. The causes are complex and multi-faceted, including: 1, the abuse of powers by government officials as the government powers expand; 2, “the private-owned deteriorating with the state-owned advancing” (guojin mintui) worsens the picture where the survival environment for private enterprises gets more and more squeezed; 3, external demands of enterprises decrease while internal cost increases; 4, financial suppression escalates with the industrial restructuring and updating lagging behind; and 5, the fluctuation of macroeconomic policies by the government poses uncertainty for production and investment. Moreover, many innocent entrepreneurs were labeled and persecuted for their “gangster behaviors” by the policy and law enforcements in Chongqing city, which was just a glimpse of similar occasional “gangster crashing” movements in the country. Many entrepreneurs are suppressed and sanctioned in the name of “illegal fund-raising”. According to active law, the court can sentence entrepreneurs to death penalty with this charge.
Unirule Institute of Economics is planning to undertake research on the problems of the crime of “illegal fund-raising” and specific methods to abolish this charge.
It is fit for Unirule to carry out this research project. Unirule Institute of Economics is a non-profit, non-governmental organization, which focuses on institutional economics with expertise in economics, laws, and politics. It has been dedicated to independent research on China’s institutional reforms and public policies as well as the reform of private finance. In 2003, 2011, and 2013, Unirule held seminars on the cases of Mr. SUN Dawu, Ms. WU Ying, and Mr. ZENG Chengjie. These seminars have been very influential before and after the close of the cases.
Unirule Institute of Economics has undertaken research projects in corporate finance and private finance in recent years. Over the years, Professor FENG Xingyuan has been carrying out pioneering research on private finance and private enterprises. He has gained rich experience and published many publications and papers on relevant topics, including “Report on the Freedom of China’s Corporate Capitals”, “Report on the Survival Environment of China’s Private Enterprises 2012”, research on the risks of private finance, etc. In August 2013, Professor FENG Xingyuan and his research team completed and released the “Report on Private Enterprise Fund-Raiding in West Hunan and the Case of Mr. ZENG Chengjie”, which analyzed and assessed the process, nature, problems, and causes of a series of events and proposed policy recommendations concerning the fund-raising activities in West Hunan and the case of Mr. ZENG Chengjie.
Business Ethics Declaration of Chinese Entrepreneurs
Over the last three decades, China’s economy has been embracing rapid growth with entrepreneurs being a key drive. The biggest and most significant structural change is the rise of entrepreneurs who constitute the pillar of the society nowadays. Today, the biggest, and the youngest group of entrepreneurs are going international, bridging China and the world.
However, because of the abnormal political, social and ideological environment of China for the last five decades, Chinese entrepreneurs happen to be widely confused and for the last thirty years, the emerging group of entrepreneurs has been suffering from severe anxiety over identity:
Firstly, due to the long time anti-market ideological propaganda by the authorities, many entrepreneurs believe they have the “original sin”. They are led to believe that their profits are based on exploiting the workers, which further leads to their confusion and anxiety over the ethical justification of their fortune and profits.
Secondly, this anti-market ideology also affects the public; leading the public to envy the fortune of entrepreneurs while disrespect them since their deeds are “unethical” and “dishonest”. This public opinion, in return, affects entrepreneurs’ self-identity. They, therefore, can’t convince themselves of the contributions they make to the society, or identify themselves within the social hierarchy.
Thirdly, Chinese entrepreneurs, especially those whose enterprises have gone international, are bothered with this severe identification anxiety. Chinese people stand out in entrepreneurship, so do Chinese enterprises. But what are the driving forces behind? Thanks to the long time culture break-up from the traditions, and the anti-tradition propaganda, Chinese entrepreneurs find it hard to comprehend and identify their cultural and social roles. This leads to the chaotic and restless mental state of entrepreneurs. This also results in the lack of a cultural supportive pillar for enterprise management in China.
“Business Ethics Declaration of Chinese Entrepreneurs” aims to provide answers to the anxiety over identity for Chinese entrepreneurs, to re-identify them by providing authentic and orthodoxical conceptions, to help them mature their thoughts and corporate social responsibilities.
This research project is committed to establishing a value system for Chinese entrepreneurs. To confront the anxiety over identity for Chinese entrepreneurs, this project provides answers to the three questions below:
1.Do Chinese entrepreneurs have the “original sin”?
2.What do Chinese entrepreneurs contribute to the society?
3.How do Chinese entrepreneurs gain respect?
An Economic Research of Chinese Urban Smog Management
The issue of smog has been on the spotlight in China that no matter government officials, ordinary citizens, or journalists and the press have expressed serious concern and anxiety towards it. Unirule Institute of Economics takes on this research topic and is conducting an economic research on China’s urban smog management.
The urban smog is attributed to multiple factors with many interest parties involved, which also makes it an economic issue. Unirule seeks to find a solution to the management of smog by the design of institutions from an economic point of view.
Fairness and Efficiency of Financial Resource Allocation
The first scale problem of the fairness and efficiency of financial resource allocation is whether the overall tax bearing standard falls within the optimal interval, whether the design of tax kinds and the mechanism will harm the development of the economy. The second scale problem is whether the expenditure structure of the existing financial resource allocation, especially transfer payment, obeys the principal of justice, and the efficiency of financial expenditure especially the general administrative costs.
Unirule Institute of Economics is going to undertake research on the fairness and efficiency of financial resource allocation with the emphasis on the second scale problem. In order to fulfill the ideal of justice in a society, the involvement of financial resource allocation is one of the methods, and a universal one. A state can promote justice by implying financial expenditure in two ways: the direct and the indirect way. When applying the direct way of implying financial expenditure measures to promote justice, financial expenditure is directly distributed to individuals to fill the gap of incomes between individuals.
Among the financial expenditure items of China are pensions and relief funds for social welfare, rural relief funds as well as social insurance funds. The indirect way is by governments' increase in expenditure used for supporting agriculture and villagers, construction of infrastructure, education and medical treatments. This research is on the justice of financial resource allocation and it deals mainly with whether the transfer payment of financial resources obeys the second rule of Rawls's theory of justice, which states that when violation to the first rule has to be made, resource allocation can be towards the poorest group of people. Besides the justice issue, efficiency is also involved in the financial resource allocation. The administrative costs of China have long been above the average standard of other countries in the world, therefore, a big amount of public financial resources are wasted (trillions of RMB per year as estimated). In regard with the efficiency issue of the financial resource allocation, this research deals mainly with the change of ratio of administrative costs by government agencies (in addition to other costs, such as medical treatments of government officials covered by public budgets, and housing subsidies) of financial income. The reform of the fiscal and taxation system is one of the core issues in China's on-going reforms. This research aims not at a comprehensive examination of the fiscal and taxation system, but a specific aspect which is the "fairness and efficiency of financial resource allocation", and evaluating the status quo of China's financial resource allocation.
Research on China's Urbanization on the Local Level
Urbanization is one of the most essential economic and social policies of the new administration. The emphasis of this policy is posed on medium and small cities as well as townships. As noticed, there are thousands of industrialized townships in China with their social governance lagging far behind their economic development.
Firstly, a big population is located in between the urban and rural level, which can't transform into citizens. Hundreds of millions of people have left their villages and moved to commercialized and industrialized towns. They are in industrial and commercial occupations and it is highly unlikely that they would go back to their villages. However, they are not entitled to local Hukou registration, which further leads to the deprivation of various rights, for example, the right of education.
Secondly, public governance in such industrialized and commercialized towns, in general, is at a rudimentary level. The number of officially budgeted posts is asymmetric with the population governed, which leads to the employment of a large number of unofficially budgeted staff and unjustified power to govern. There is a lack of financial resources for the local government to carry out infrastructure construction or to provide public goods sufficiently. Thirdly, the urbanization results in imbalanced development of the structure of society. Since the industrialized and commercialized townships are unable to complete urbanization, urbanization in China has basically become mega-urbanization which is dominated by administrative power. Local governments centralize periphery resources with administrative power and construct cities artificially, which impedes townships and villages from evolving into cities by spontaneous order. Fourthly, industry upgrading can't be undertaken in those industrialized and commercialized townships and the capacity for future economic development is greatly limited. The industry upgrading is, in essence, the upgrading of people. Enterprises ought to draw and maintain technicians, researchers, and investors, to meet their needs for living standards, which cannot be satisfied by townships. Similarly, the lagging urbanization reversely sets back the cultivation and development of the service industry, especially the medium and high-end services.
Unirule Institute of Economics is going to carry out research on urbanization of China on the local level, aiming at improving public governance of the industrialized townships, optimizing the urbanization methodologies, and improving the "citizenization" of migrant workers, therefore further pushing social governance towards self-governance and democracy.
Research on the Public Governance Index of Provincial Capitals
At the beginning of the year 2013, Unirule conducted field survey, including more than 10 thousands of households in 30 local capital cities. According to the field survey, the Public Governance Index was derived. The main conclusions of the PGI report as below:
Three statements summarize the status quo of public governance in provincial capitals. Firstly, public services have generally just gotten a pass. Secondly, protection to civil rights is disturbing. Finally, governance methodologies need improvements. These statements point out the solution: the structure of the society needs to be altered from that with a government monopoly to a civil society with diverse governance subjects. The ranking of provincial capitals in the public governance assessment from the top to the bottom is as follows: Hangzhou, Nanjing, Urumqi, Tianjin, Chengdu, Shanghai, Beijing, Nanchang, Xi'an, Xining, Shijiazhuang, Wuhan, Guangzhou, Yinchuan, Hohhot, Chongqing, Shenyang, Changsha, Jinan, Kunming, Nanning, Haikou, Fuzhou, Guiyang, Harbin, Hefei, Changchun, Zhengzhou, Taiyuan and Lanzhou.
Generally speaking, all provincial capitals are graded comparatively low in the three public governance assessments from 2008 to 2012. Even those that ranked the highest in performance have just barely passed the bar of 60 points. Few provincial capitals with poor public governance got over 50 points.
There is a certain amount of correlation between the changes of ranking and improvements in public governance in provincial capitals. In the short term, should the capital cities be willing to raise their rankings, they can achieve this by increasing transparency in government information and civil servants selection, encouraging local non-governmental organizations, or promoting wider participation in local affairs. There is but a weak correlation between public governance and the local GDP level. However, a strong correlation exists between the rankings and the equity of local fiscal transfer payment. That is to say, a region gets a higher ranking in public governance if subsidies to local social security, medical care, education and housing are distributed more to the poorest residents in that region. On the contrary, a region's ranking falls if such resources are distributed with prejudice to the groups with high incomes. This phenomenon shows that equity is of significance in the assessment of the government by the people.
When residents are not satisfied with medical care, elderly support system, water supply and electricity supply, the situation can be improved when they complain to the government. But when similar situations take place in public transportation, environment greening, heating systems, and garbage management, whether by collective actions or filing complaints to government agencies, residents can hardly be satisfied with what the government does.
According to the three public governance assessments carried out from 2008 to2012, we discovered that the Gini coefficient of residents in provincial capitals was decreasing and the income fluidity was improving. From 2010 to 2012, citizens' comments on protection of civil rights are deteriorating, especially in terms of property and personal security. The request for freedom of speech is also increasing. For the moment, citizens in provincial capitals have a low evaluation on the cleanness and honesty of local governments.
Research on Disclosure of Government Information
Room for reforms is getting narrower as the opening-up and reforms deepen. It also leads to a more stabilized vertical mobilization of the demographic structure with the conflicts in the distribution of interests exacerbating. A collaborative system centering the political and law system and involving close cooperation between the police, courts, petition offices, and the city guards (Chengguan) is developed to deal with social unrest. This system is operated by local governments and finalized as a system of maintaining stability (Weiwen). There have been Internet spats over the amount of Weiwen funds. It is unsustainable to maintain such a Weiwen system, and the disclosure of government information is the most significant approach for this end. The essence of public governance is to dissolute conflicts instead of hiding and neglecting them. And one way to achieve this is by sufficient communication. Public and transparent appraisement and supervision cannot be achieved without transparent government information, otherwise the result will be the exclusion of citizens from public governance.
Unirule Institute of Economics has been undertaking research on the disclosure of government information since 2011. This research is carried out not only from the perspective of the regulations for the disclosure of government information which evaluates whether governments of various levels are obeying the regulations and their performances, but also by examining information disclosure laws in developed countries while looking at the status quo in China. There are seven aspects where government information disclosure can be improved, namely, information disclosure of government officials, transparency of finance, transparency in the decision-making mechanism, transparency in administration, transparency in public services, transparency of enterprises owned by local governments, and transparency in civil rights protection.
Upcoming Events
Unirule Biweekly Symposiums
Unirule's Biweekly Symposiums are known in China and throughout the world for their long history of open and in-depth discussions and exchanges of ideas in economics and other social sciences. Over 380 sessions have been held and over 15,000 scholars, policy makers, and students, as well as countless readers on the web, have directly and indirectly, and participated in the Biweekly Symposium for close to 20 years.
Biweekly Symposiums begin at 2 p.m. every other Friday and are free and open to the public.
Schedule
Biweekly Symposium No. 557: 9th Sep., 2016
Biweekly Symposium No. 558: 23rd Sep., 2016
Previous Biweekly Symposiums
Biweekly Symposium No. 554: Economic Heritage of the War of Resistance Against Japan: State Power, Economic Restructuring and Development.
Lecturer: LI Feiyue
Host: Guping
Commentators: XU Jianming, GAO Yuan, ZHAO Wenzhe
Professor LI Feiyue introduced literature on the relation between state power and economic development. State power refers to the capacity of the government to extract resources and provide public services. However, economic development is, to a large extent, determined by the government’s capacity to undertake effective governance. If the government capacity to extract resources and to undertake effective governance are combined organically, economic development can be expected. He thought wars are an major source of state power, and judging from the Communist Party of China’s history, the War of resistance against Japan played an important role in nurturing local level organisations and cultivating government officials. This practice has a huge influence on China’s state governance system that is based on local government capacity and autonomy. He also analysed how the activeness of local governments and their interaction with the central government constituted a competitive relationship that supersedes the delegated powers.
Dr. XU Jianming said that we should remain cautious towards statement such as wars as sources of state power. He also criticised the presentation’s conclusion concerning governments’ role in providing public goods.
Professor ZHAO Wenzhe thought that better governance entails high expenditure in science, education, culture, and healthcare while economic expenditures decrease, which drove up economic development. However, this conclusion only applies to the 1990s, or even 2000s.
Editor: MA Junjie
Revisor: Hannah Luftensteiner
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