Don't care if the objective will be attained or not; China should prepare for the reform of distribution system

The Unirule Institute of Economics released its Macroeconomic Analysis Report for the 3rd Quarter of 2012 at a conference held on October 26th，2012.Prof. Zhuang Shuguang introduced the report.

According to the report, there is no need to worry or pleased that China's third-quarter GDP growth slows to 7.4 percent, slightly sliding below government's target , but the rate of decline is gradually narrowing. Under the circumstances, it is better to promote exports than speed up the transformation and upgrading of export industries; it is better to enlarge the scale of investment than optimize investment structure and improve investment efficiency; it is better to increase the strength of the economic incentives than be free to develop non – government economic; it is a serous problem that the income gap is too wide and income distribution is uneven. In view of this, the reform must be enforced. The point is how to solve the monopolized sector's interest-occupation problem, the state-owned sector's behavior constraint problem and how to reduce and regulate grey income, and how to address official corruption.

Zhang Shuguang
Chairman of Academic Committee, Unirule Institute of Economics

Highlights

Freeways should not be Free
By Prof. Mao Yushi

To please the common people, the government often does some specious things by making use of the ignorance of the common people. Toll-free highways on the National Day Holiday serve as a good example. Instead of gaining extra advantage as expected, people was fooled and suffered far greater loss than the highway toll they saved in terms of the time they wasted in traffic jams.

It is the same case with the economically affordable housing and the luxurious low-rent housing. However, the pity is that the people are so gullible and do not know where their real interest lies. As a result, they were fooled time and time again. It's hard to know when they will finally come to reason. Highways could be free of charge, but not free of cost. Construction and maintenance both cost money. If users of highways are free of charge, who is to pay the cost? Surely I will be cursed roundly if I say highways should charge more rather than be free.

However, we should make an objective comparison between free tolls and higher tolls so as to see which is more reasonable. In other words, we should know where our real interest lies rather than jumping rashly to the conclusion that spending less is always good while charging more is always bad.

How should highways be charged? What standard should be used? The standard of economics is avoidance of waste. Excessively low charging will cause traffic jam and result in significant time loss while excessively high charging will lead to insufficient utilization of highways by cars and waste the capacity of highways. Appropriate charging should avoid both traffic jams and insufficient utilization. There are also other standards, such as, helping the low-income earners. It is all right if certain efficiency is sacrificed and some waste is caused. We should also take the revenue of the government into consideration.

Mao Yushi
Honorary President, Unirule Institute of Economics

EFN 2012 Statement on Liberal Views on Populism
by Unirule

We the liberals believe that populism is the promise of statemandated , unsustainable benefits to the broader population without consideration of the long-term costs and benefits. It relies on highly emotive statements. In fact, populism is counterproductive to general well-being and progress, as illustrated by the economic decline of the many countries that have pursued populist agendas.

We are concerned that governments in Asia are turning away from the policies which have been demonstrated to promote prosperity in many parts of the world.

We are confident that people will reject populist policies once they understand the true costs associated with them.

Those costs include an increasing dependency on the state,weakening the rule of law, property rights and individual freedom. Populism also reduces the ability of individuals and local communities to make their own decisions, and undermines the competitiveness of businesses.

Recent moves in Asia to subsidise food and fuel, and to transfer cash are all examples of populist policies that have done more harm than good.

We are confident that if Asia commits itself to liberal values such as property rights and the rule of law, the region will prosper.

We commit to:
· Provide alternative liberal solutions to the real problems that give rise to populism, and educate about the benefits of liberal policies, using positive language and examples.
· Provide public support to politicians, political parties, business groups and other stakeholders that support liberal solutions.
· Expose the high costs in terms of money and disastrous end results of such policies

Current Events

The Seminar of Celebrating the 30th Anniversary of the Publication of Mathematical Foundation of Economics: Principle of Optimal Allocation written by Mr. Mao Yushi

To celebrate the 30th anniversary of the publication of Mathematical Foundation of Economics: Principle of Optimal Allocation written by Mr. Mao Yushi, the Unirule Institute of Economics organized a seminar in Beijing Schonbrunn Hotel on September 21st, 2012. Hundreds of economists, jurists and entrepreneurs from all over the country attend the conference. Very known economists such as Prof. Zhou Qiren, Prof. Zhang Weiying, Prof. Deng Zhenglai, Prof. Song Guoqing, Prof. Shi Xiaomin, Prof. Lu Feng , Prof. Tang Min, Prof. Yang Ruilong, Prof. Wei Sen, Prof.Mao Shoulong, Ms. Zuo Xiaolei, Mr. Ren Zhiqiang, Mr. Guo Zilin, Prof. Wang Guoxiang, Mr. Yao Zhongqiu , Prof.Zhang Shuguang, Prof. Sheng Hong, Prof. Feng Xinyuan , Prof. Zhao Nong  also take part to the conference. They had discussion on “Mathematical Foundation of Economics: Principle of Optimal Allocation by Mr. Mao Yushi”, “their other academic thoughts and policy ideas and “the Chinese economics review and outlook” in the conference.

The conference was divided into two sections. The first one, hold in the morning, mainly focused on Mathematical Foundation of Economics: Principle of Optimal Allocation. And the second part, hold in the afternoon, was about “Chinese economics review and outlook”.All of the scholars discussed on Mathematical Foundation of Economics: Principle of Optimal Allocation drastically and had a deep respect for Prof. Mao Yushi and his viewpoints. They  regarded his book as a Mathematical Economics monograph full with innovations. Prof. Mao Yushi's book underlines the main principle of microeconomics which can guide us to analyze the transition to planned economy to a socialist market economy.Besides, outstanding contributions of the book in popularizing the knowledge of market economy and promoting market economy reform were affirmed by the participants. Some of the participants also expressed their point of view about the trading aspects such as: “trading creates wealth”, “trading coordinates the division of tasks”, and “the link between trading and evolution”Others pointed out the fact that that book includes some Austrian schools of economics thoughts, which are very poorly known such as the thought of Market process, entrepreneur spirit and error correction.In the last part of the conference, Prof. Mao interacted with the participants.

The conference which have been sponsored by some enterprises and individual, such as JunZeJun Law Offices, Creat Group, Legend Holdings Ltd. ， Broad Group Ltd.,Mr. Duan Shaoyi ,Mr. Wu Ying, Ms. Zhang Kexin, and Mr. Zhang Xueze ， gathered elites from economic circle, legal profession, business circle and law field. It has been covered by More than 10 mainstream media both at home and abroad.

For more details : The Seminar of Celebrating the 30th Anniversary of the Publication of Mathematical Foundation of Economics: Principle of Optimal Allocation was held sucessfully.

Forum on Promoting Open Government Information – an Investigation in Beijing, Guiyang and Yinchuan Research Report Release Conference

The Forcible Land Acquisition Case in Panjin and Reform of Land System Meeting was held in Beijing On October 18th, 2012, jointly organized by the Unirule Institute of Economics and the Sina Blog. Prof. Sheng Hong, Prof.Dang Guoying, Prof. Zhang Qianfan,Prof.Yao Zhongqiu , Prof. Feng Xingyuan, Mr. Wu Lei, lawyer from Shandong Chengsi law firm; Mr. Zhou Lixin, lawyer from Beijing Fengrui law firm,Prof. Zheng Zhenyuan, former vice-director of the Department of Land Use Planning of the State Land Administration ,Mr.Yang Junfeng, lecturer from Chinese People's Public Security University attended the Meeting.

Participated experts discussed historical causes and recent situation s of land expropriat ion in Panjin, Liaoning province. They believe it is a vicious crime that a police officer shot a homeowner dead in a demolition protest. In this case, the citizen's personal security and private property was seriously violated by state power . After the incident, the local government hastily pronounced the shooting was justified under the law and the officer is innocent without any deep investigation by public media. This response is inappropriate and unjust. To preserve the rule of law and to promote justice, the experts appealed to the Standing Committee of the National People's Congress for setting up an independent commission to investigate this incident and publish the report.

The Unirule Autumn Outing 2012

The staff of the Unirule went for an autumn outing at Mangshan National Forest Park on October 20th. Located on the east side of Ming Tombs Reservoir in Changping District, with the highest peak at 659 meters, the mountain is named Mang (meaning python in Chinese) because it undulates like a huge python. Covering an area of 8,000 hectares, Mangshan National Forest Park is the largest of its kind in Beijing. Apart from the vast natural landscape, there are several cultural attractions such as the Grand Buddha, Mangshan Pagoda, and the Highland Corridor.

Walking with at a brisk pace, we climbed up the mount. We stood on top of the hill, drinking in the beautiful view, which is harmony between the different colors. Maple leaves aflame with color. Chrysanthemums are sunlight yellow. Attractions each, like fine music, excited our heart and the calmed our soul. Our autumn outing coincided with the 9th Apple Culture Festival. So we drove into an apple orchard and picked apples. We played with bursting laughing and had an incredible time. The beautiful view, the great delicacy and delicious apples left us endless aftertaste.

News

Prof. Feng Xinyuan Attended the forum on the Quarterly Focus on China's Economy

Prof. Feng Xinyuan attended the forum on the Quarterly Focus on China 's Economy and gave a speech entitled “An Economical Need to Reduce Regulation and Private Financing O perations Shows a Great Potential and Pro mise” on August 31 st , 2012 in Taiyuan . There is a economical need to reduce double regulation: economic regulation and financial regulation. Otherwise, the funding will only serve latent purposes without offering any future.

Prof. Sheng Hong Attend the Australia in China's Century Conference

Prof. Sheng Hong was invited to attend the Australia in China 's Century Conference, which was jointly organized with Australia and The Wall Street Journal in Sydney on September 14 th , 2012. He made a speech entitled “China Model: One with Short-term Effect but not Sustainable”. He explained why one-party system may basically constrain administrative officers not to use the public powers for their interests in a sort term (several decades), and why this efficacy would lose gradually in the long run. ” A successful market economy needs a political structure which can keep administrative powers from intruding private property rights, which is a fundamental of market economy. However, the economic miracle in China seems to prove the proposition above is wrong, for there is a political party without external restriction in China. ”he said.

The Report of The Nature, Performance, and Reform of the State-owned Enterprises in English was published by World Scientific Publishing.

The report of The Nature, Performance, and Reform of the State-owned Enterprises in English, which was in charge of Prof.Sheng Hong and prof.Zhao Nong, has been printed by World Scientific Publishing.

Prof. Sheng Hong Attend the China Financial Planning Expo Prof. Sheng Hong was invited to attend The China Financial Planning Expo on October 13 th , 2012, and delivered a speech entitled “China'sRise and the Roads have Twists and Turns”

Prof. Sheng Hong Attend Annual National Planning Conference 2012

Prof. Sheng Hong was invited to attend and made a speech entitled “To realize urbanization with commercialized means” at Annual National Planning Conference 2012 on October 17th, in Kunming.

Mr. Yao Zhongqiu was Appointed Professor of Beihang Institute of Advanced Studies in Humanities and SocialSciences

Mr Yao Zhongqiu , Present of unirule,was appointed professor of Beihang Institute of Advanced Studies in Humanities and Social Sciences. Beihang Institute of Advanced Studies in Humanities and Social Sciences (BHIASHSS) was established in November 2010 in conformance with a new round of higher education reform.

Prof.Yao Zhongqiu Published his book named Virtue, Gentleman and Custom

Prof.Yao Zhongqiu published his book named virtue, gentleman andcustom, which is enlisted inMacro Vision Articles edited by Beihang Institute of Advanced Studies in Humanities and Social Sciences. This book's topic is social construction, however, the author try to face facts and discuss the Chinese society construction form the Confucian position. Hence, it highlights virtue, gentleman and custom. It can be help for us to think about the contemporary Chinese good social order structure.

Mr.Yao Zhongqiu Published the Article Named “a New Reform Paradigm: Chinese Cultural Renaissance” in theJournal of Open Times

Mr.Yao Zhongqiu published the article named “a New Reform Paradigm: Chinese Cultural Renaissance” in the Journal of Open Times in September, 2012.The article points out that the achievements, boiled down to reforms in the past thirty years, is largely depend on Chinese Cultural Renaissance. That's to say, reform is a process in the history of Chinese civilization revivals. Looking at reform from the angle of Chinese civilization revivals will form a new paradigm to think and promote the institutional reform. If this great vision brings in, it may give elite groups an incentive to move towards maturity in politics and comeout the predicament of reforms.

Hunan People Press will publish Mr. Yao Zhongqiu's New Book Called “Rediscover Confucianism”.

Hunan People Press will publish Mr. Yao Zhongqiu's new book called “Rediscover Confucianism”. The book is discussed eighteen misconceptions of Confucianism, which handed down from ancient times and severely impinged on understanding Confucianism, and tries to uncover the mud on Radical intellectuals and rediscover a true Confucianism, sparkling with elegance and intelligence. What's more,some articles, argued with Yi Zhongtian ,Yuan Weishi and Zhang Raojie in 2011 ,are attached the end of the book.

Current Researches/Consultings

The Research on the Efficiency of Resource Allocation by Administrative Departments in China
The management system of China’s administrative departments is basically still government-dominated, and the functions and powers of some administrative departments involve various aspects of economic activities, such as industry planning, administrative examination and approval, distribution of fiscal resources, manning quotas, etc. These administrative departments possess great power over the control and allocation of various resources and rely mainly on administrative means rather than market mechanism for resource allocation. To a large extent, this equals to the direct allocation of resources by administrative departments. Without sufficient constraints provided by a constitutional framework, officials at administrative departments are likely to abuse their power, thus leading to unreasonable allocation and waste of limited resources. With the establishment of the market economy, this sort of highly centralized mode of resource allocation and supply is unable meet the demand of social development any more.

This research aims at making a thorough analysis of what sort of resources administrative departments have monopolized, how these departments allocate these resources by making use of power in their hands, as well as the efficiency and results of this kind of allocation so as to give certain suggestions on institutional solutions and policy basis which will improve resource allocation in these fields.

The Research on Land Law Systems
The frequent occurrence of local governments encroaching on the land rights of farmers has now pushed Chinese society to the brink of social unrest. The causes not only lie in local governments’ fiscal problems but more importantly, in the major defects existing in China’s current legal system regarding land issues. One of the major problems is that China has not formulated any basic land laws except for the Land Administration Law, which is similar to regulations made by an administrative department. Aimed at pursuing benefits or convenience for administrative departments, the Land Administration Law has many problems. Moreover, the most recent Amendment Draft of the Land Administration Law proposed by the Ministry of Land and Resources actually further strengthens the power of land administration departments and other administrative organizations and further reduces the land rights of rural collectives and farmers.

Due to the drawbacks of "department legislation" and weak points of the People's Congress caused by China’s constitutional defects, a fair land law draft should be proposed by a neutral social organization rather than an administrative department. Since Unirule is qualified for this mission both in terms of motives and capacity, we’ve launched a research program aiming to provide a reference scheme of China’s land law system in order to fundamentally solve China’s land problems.

Research on Large Enterprises in the Marketization Reform
During the process of China’s transformation from a planned economy to a market economy, the interaction of various economic subjects exerted a significant impact on China’s economic and political system and policies. As one of the major economic subjects of huge scale, large enterprises possess a strategic industrial position. Large state-owned enterprises, in particular, have a historical relationship with the government and have exerted much influence on China’s social structure and developmental direction. This research aims at making a thorough investigation on various kinds of large enterprises, sorting out their position and influence on China’s economic operation and political activities, exploring the mechanism of this process and giving suggestions on better institutional plans and policy suggestions so that the government could work out better systems and policies which will benefit the adjustment and growth of large enterprises in the future.

Research on the Development of Social Organizations in Zhongguancun from the Perspective of Constructing World-class Scientific Innovation Centers
The State Council has approved the construction of the Zhongguancun National Innovation Demonstration Zone and requested that Zhongguancun should be built into a world-class scientific innovation center. Zhongguancun has the opportunity to enjoy a new round of leapfrog development. As an organic part of the innovation activities in Zhongguancun, social organizations play a positive role in promoting the formation of innovation clusters and the supply of public services. Under the new historical circumstances, it’s of great significance to make a thorough analysis of the current development status and direction of social organizations in Zhongguancun by learning from the development experiences of social organizations in Silicon Valley so as to make suggestions on the direction and relevant measures of governmental control. Entrusted by the Administrative Committee of Zhongguancun National Innovation Demonstration Zone, this research will analyze the current status of and existing problems with social organizations in Zhongguancun, propose certain targeted, prospective and operative ideas, institutions and procedures, and give answers to a series of questions.

Upcoming Events

2012 Economic liberalism Training 

2012 Economic liberalism Training, organized by unirule, will be held on December 1st, in beijing.

Economic liberalism is the promotion of market mechanisms, the economic theory and policy system aiming at opposing too much interference in the economic operation exercised by government. The function of market mechanisms embodied in the principles of Adam Smith's "invisible hand". The proposition of economic liberalism is to minimize government control and intervention in the economy, to advocate the value of products and services should be determined by the choice of individual freedom, that is, the market forces.

Nowadays, in China, there is a tendency of to an anti-economic liberalism--excessive government interventions in the development of market economy, such as the proposition of government regulation, too much implementation of inappropriate planning and unreasonable system design, which seriously hindered the development and normal operation of market economy. These run counter to our concept of moderate government intervention. Therefore, through this training, Unirule Institute of Economics aims at enabling local government officials to have a clearer sense of government policies in economic development, reasonably exerting their rights in future policy-making process, and more completely utilizing the power of market. Thus, economic development can return to a rational state.

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.466: November 23th, 2012
Biweekly Symposium No.467: December 7th, 2012

Previous Biweekly Symposiums

Biweekly Symposium No. 459

Time: August 17th, 2012
Topic: the quantitative evaluation of Qing dynasty: view social vicissitudes from the occurrence of the homicide cases
Lecturer: Prof. Chen Zhiwu

Bi-Weekly Symposium No.459 was held on August 17th 2012. The topic was " the quantitative evaluation of Qing dynasty: view social vicissitudes from the occurrence of the homicide cases” and the keynote speaker was Chen Zhiwu, Professor of Finance of Yale School of Management.

In his mind, the ultimate goal of the social development should maximize the social welfare. He found that the occurrence of homicide cases had been uplifted nationally in the 18th century, which was quite opposite to what had happened in the 19th century. At the same time, due to the database of homicide cases is representative, he discussed the social change from the perspective of homicide cases and explained the difference between the two and compared with the changes of European homicide cases in the past 800 years. By regression analysis, he pointed that the two kinds of homicide cases rate are inversely proportional to the population density and the development level of market, etc. What's more, the influence of the centralization degree of land distribution, the proportion of self - employed farmers on the coincide of homicide cases is discussed.

Biweekly Symposium No. 462

Time: September 28th, 2012
Topic: China's future and the current cross-Straits relations
Lecturer: Prof. Wu Qiongeng

Bi-Weekly Symposium No.462 was held on September 28th 2012. The topic was " China's future and the current cross-Straits relations” and the keynote speaker was Wu Qiongeng , Professor of National National Chengchi University .

In this forum, Prof. Wu Qiongeng first confirmed that the combination of socialism with market is a vast creation. He also criticized the exaggerated materialism, advocated that we should make the best use of Confucianism to enrich the theory foundation. At the same time, he said that the pragmatism, which can be understand in the early days of China's reform and opening-up, should be improved in the future. Besides, he pointed that China should promote Chinese traditional culture and coagulate Chinese culture attractive. Improve the market economy according to local conditions and different times, instead of the universal truth. In the last, he said, “Only the personal sense of culture responsibility reached to some point, the democracy should be practiced”

Editor: Liu Qian