Michael Spencer: China's economy in the world pattern

Time: November 6, 24

Location: auditorium of the Great Hall of the People

Speaker: Michael Spencer, winner of the Nobel Prize in Economics

Topic: China's economy in the world pattern

Moderator: Zhang Zhuoyuan, member of the Academic Committee of China Academy of Social Sciences

Zhang Zhuoyuan, ladies and gentlemen. Professor Spencer is a member of the American Academy of Arts and Sciences, and now serves as honorary president of stanford graduate school of business. He received a bachelor's degree in philosophy from Princeton University in 1966, a master's degree in mathematics from Oxford University in 1968 and a Rhodes Scholarship, and a doctorate in economics from Harvard University in 1972. Professor Spencer has been the head of the Department of Economics of Harvard University, the dean of the College of Arts and Sciences, and the dean of stanford graduate school of business, and has also served as the chairman of the National Science, Technology and Economic Policy Research Council of the United States. In 21, Professor Spencer won the Nobel Prize in Economics for his outstanding contribution in the field of information economics. Professor Spencer is not only an outstanding economist, but also an excellent professor. He has been teaching in internationally renowned universities. The Graduate School of China Academy of Sciences has hired Mr. Spencer as its honorary professor. Before today's speech, Professor Deng Yong, vice president of the Graduate School of China Academy of Sciences and director of the teaching committee, presented Mr. Spencer with the honorary professor certificate.

Congratulations to Mr. Spencer on his appointment as honorary professor of the Graduate School of China Academy of Sciences. Next, I would like to invite Professor Spencer to give a speech. The topic of his speech is "China Economy in the World Pattern". Let's welcome with warm applause.

Michael Spencer: I understand the introduction just now. Thank you. I feel honored to be here today, and I am very grateful to the Graduate School of China Academy of Sciences for awarding me the honorary professor just now. I hope that in the near future, I can discuss the topics we are interested in with my classmates in the graduate school in class.

I am an economist, and my interest lies in market structure, market operation, market information characteristics, and how the Internet affects the market and how it affects the global market in terms of information. I will talk about some global topics, but at the beginning, I want to talk about general academic research.

I think everyone here is determined to be a scholar, a researcher or a teacher. As we all know, the academic community has constituted, and remains, the first truly internationalized * * * isomorphism. When an important new discovery is made in academic circles, such as an important theorem in mathematics being proved in Moscow, scholars all over the world who pay attention to this issue will begin to understand the progress in this field in a very short time, hours instead of days, even before the emergence of the Internet. The reason why we are a * * * is that we have the same and important values in such an increasingly globalized world. We all agree with the openness of academics, unimpeded communication, intensive study of knowledge and universal recognition of academic achievements, no matter where this achievement comes from. In this world, there are many coercive forces such as nationalism, the separation of culture and race, trying to separate us. Therefore, the international isomorphism like ours in academic circles is particularly important because they play an important role and deserve our cherish, care and support.

One of the concerns of this forum on science and humanities is that there is some tension between different disciplines. I want to point out that all disciplines will focus on some aspects of the world or human life without exception, while ignoring other aspects, which is absolutely necessary for making progress in academic research, and there is nothing wrong with it. People will ask, where does this tension come from? I have thought about this problem. I think it comes not from these disciplines themselves, but from the competition of values that affect us to make important social choices, from different ways of education and communication with other cultures, from our different understanding of individuals and countries and the relationship between us and the planet on which we live. I think that the tension and competition between disciplines is healthy to a certain extent for policy makers, but if it goes beyond the scope of balance, if human living conditions, people's desires and needs have to succumb to natural science, social science and those inhuman machines that manipulate the huge and complex economic system, this tension will lead to division. It is undoubtedly important to develop the economy, which can make people free and enable people to pursue other goals, which is beyond doubt. But it also has a side effect that cannot be ignored-people tend to regard economic development as the ultimate goal. Developing economy is not an end in itself, but a means to meet other purposes, which enables people to do more important things. I live in Silicon Valley, California, USA. Silicon Valley attracts many passionate young people to develop new technologies and start businesses. People usually think that Silicon Valley is a place to create wealth, which is true, but this is not its essence. In my opinion, it is more important that Silicon Valley gives young people opportunities to innovate and change the world. When I talked with young people in China, I saw the same situation. Of course, they are also interested in economic income, but what is more important to them is the opportunity, freedom and environment that can enable them to display their skills, whether they are engaged in academic research, business or politics.

there is another source of tension between different disciplines. The academic development and contribution of natural science and social science, which I call humanities, are usually mutual steps. More than 5 years ago, people discovered the structure of DNA, which did not deny the value of Darwin's theory of natural selection, nor did it pose a threat to evolutionary biology, but promoted the understanding of these theories. I cooperated with others to study the information structure of the market, and found that the market information is asymmetric. This study is not to deny the general equilibrium economic model theory of samuelson and others, but to supplement it and expand the application scope of the economic model. The development of these disciplines seems to be like building a city wall bit by bit, brick by brick. If mistakes are found, just take down some bricks. What is important is that people gradually accumulate bit by bit. But this is not the case in the humanities, which is not cumulative, but more dialectical, requiring more speculation and relying more on fleeting insight into the human condition. Therefore, we once again see a benign tension between these disciplines. However, unless it is out of balance due to excessive competition, this tension can be controlled, and it depends to a large extent on those who have the power to decide the direction of a society. I think the academic field as a whole should be broad and eclectic, and all aspects of academic research should be considered comprehensively, and academic exploration and efforts should be viewed comprehensively, instead of focusing only on some specialized disciplines.

One thing that impressed me most was that in the 197s, the leaders of our two countries adopted an interesting way to improve relations and bridge the gap between them. At the beginning, the two countries did not hold formal high-level government-level talks immediately, but made extensive contacts in the fields of academics, education, art and culture, which enabled the people of the two countries to communicate and thus began the reconstruction of our relations. This was a very wise move at that time.

Today, leaders and people in many countries around the world are trying to build a global economic system. People in many countries that were relatively backward have begun to benefit from it in terms of economy, material conditions and development opportunities. So what I want to talk about today is what changes are taking place in the global economy, what opportunities are there, and finally I will talk about what challenges we will face together.

I am an economist, and I will discuss globalization from the perspective of economics, but I won't talk about it narrowly. Globalization is not only an economic issue, but also involves important cultural and social aspects, which we have not yet fully understood. These problems are important because we are becoming more and more interdependent. There are often potential conflicts between different cultures and values in the world, and we must face these conflicts together because we have become more and more interdependent. So we must face up to this potential conflict. For example, 2 years ago, not many people in the world paid attention to China's economic development, because frankly speaking, from the economic point of view, it didn't matter to most people in Europe and the United States whether China's economic growth rate was 8% or 1% a year ago. But now it is different, because the development of China is one of the powerful driving forces of the global economy. If China's economic development is successful, everyone in the world can benefit from it. I want to start with the example of China to talk about the state of the global economy, and then discuss some other important progress, so as to show that we now have unprecedented opportunities. Finally, I will talk about some challenges we face.

in the past 25 years, China's economy has been developing at a high speed with an annual per capita income growth rate of more than 8%, while the growth rate of productivity in the same period is roughly estimated by the input-output ratio, which should exceed 6%. During these 25 years, the poverty rate in China has also dropped remarkably. Such a speed of development and the decline of poverty rate are unprecedented in degree and scale. From the point of view of economics, it is not difficult to find out the motivation to promote China's economic development. First of all, the most important thing is to adopt and apply the principles of market economy under the conditions of socialist market economy. Market economy takes price signal and market as the center, and emphasizes the effective allocation of resources. Now it seems that the economic experiments that people carried out in the 2th century that deviated from the principles of market economy have all proved to be failures. Of course, there are many different models of market economy, but if hundreds of millions of decisions need to be made every day in a market, it is obviously impossible to make all these economic decisions together. The only exception is a single enterprise, and it is feasible to make centralized decisions at that level. I think this is not only something that we all have experienced deeply, but also generally accepted. Second, China has skillfully and very skillfully realized an incredibly complicated economic transformation, that is, from a planned economy to an increasingly market-oriented economic system. It has not only implemented a market economy at home, but also successfully integrated into the international market.

Third, policy makers in China are very concerned about the reasonable distribution of income. If we don't pay attention to the problem of income distribution, it will easily have a destructive impact on society. I mentioned earlier that the poverty rate in China has decreased, which shows that the China government attaches great importance to this issue, which is expected to enable the largest number of people to benefit from economic growth. China's success also benefits from vigorously developing education and training and establishing educational institutions at all levels. There is also the promotion of the flow of talents and labor force, so that where there are opportunities for economic development, people can flow there, and they are no longer limited by regions. This is reflected in the worldwide migration tide. More than 2% of China's urban population moved from rural areas after 1978, when the proportion of rural population was 82%, but now it is about 6%. This is indeed a huge population flow, and it is not an easy task to manage it well. We might as well compare the economic growth rate of contemporary China with the countries that completed the industrial revolution earlier in history. The data used below comes from my colleague Paul at Stanford University. Raman. Britain first started the industrial revolution in the 18th century. During a century, the annual growth rate of their economy was 1%, and its total economic output doubled in 7 years. The economic growth rate of the United States and major European countries during the industrialization period was 2%, and their economic aggregate doubled every 3 years. The growth rates of Japan, South Korea and Taiwan Province are all higher than those of the United States, while the economic growth rate of Chinese mainland is even higher. What kind of difference does this make? If the economic growth rate is maintained at 1-2%, the speed of economic development will not be slow, which is enough to change people's living conditions during their lifetime. If the economic growth rate reaches 8%, it not only shows the rapid economic growth, but also the face of the whole economic activity will undergo one or two major changes in just one generation. The reason is simple: if the relative price changes, it will drive the development of different industrial sectors, so that people's income and wages will rise and the way of economic activities will change accordingly. People have become accustomed to regard China as the center of the most important labor-intensive manufacturing factory in the world, with high product quality and relatively low labor and manufacturing costs. But in another 2 years, the situation may change, because people's income and wages have increased, and people's employment orientation is likely to change, especially in today's situation where people's working methods are changing at an unprecedented speed, which will be a considerable challenge. This is why we should pay special attention to education. Education is a key intangible asset because it can enable people to adapt to the rapidly changing environment.

let's look forward to the development of China. China's current gross national product, or GDP, is US$ 1.3 trillion, equivalent to one tenth of that of the United States and slightly more than that of Italy. The population of China is four times that of the United States, so the per capita income is equivalent to one fortieth of that of the United States, but this conversion is distorted, because people know that the price level in China is relatively low, so the real per capita income in China should be two to three times that of the United States, about one fifteenth. I predict that if China can maintain its current economic growth rate, its total economic output will roughly double every ten years. China is expected to become a very important economy in the next 2 to 25 years.

if China can continue to develop at this speed, it will become an important economic power in the next few decades. By the middle of the 21st century, there will be three dominant economies in the world: the United States, the European Union and China, followed by Japan and India. For the whole world, this is a brand-new change, a huge change. Fifty years is a long time, and China's economy will become very important in the world.

next, I'll talk about India. India's economy is only half that of China, and its population is slightly less than that of China, but its population is growing faster than that of China, and I think everyone knows why. In recent years, India's economy has developed rapidly, and a group of well-trained talents have gathered in the information industry and related fields. Especially due to the appearance of the Internet, these human resources can play a role in the global economy. For example, the ability of these talents has been demonstrated in the United States and European countries. Therefore, in a sense, India is becoming one of the countries that are developing rapidly and gradually integrating into the global open economic system. But India is still not completely