山登绝顶我为峰

January 23, 2009

《佃农理论》是四十多年前发表的了,之后那么多年我有其它作品超越《佃农》的水平吗?很难说。巴赛尔及几位朋友认为《价格管制理论》胜出,但那是三十五年前的作品了。我认为三卷本的《经济解释》及去年的《中国的经济制度》胜出,同意的人可能不多。科学的顶峰真的摸不着,无从界定。我觉得自己的经济文章愈来愈随意,愈来愈变化多,愈来愈像二百多年前的史密斯。今天以中文下笔,只凭一点灵感,直觉认为是对,逻辑复核一下,向有趣的地方推呀推的,但规格再不严谨了。世事多知了不少,挥洒远为容易。多活了数十年,经验累积是无可避免的吧。」

This article by Professor Cheung has brought up two discussable issues.

1.  Among all his works, which is the best?

I personally would vote for ‘The Fable of the Bees’: a paper with much originality and supported by solid empirical data

2.  The style is getting closer to Adam Smith

One major strength of Smith’s work is the evidenced based approach.  I would argue that Professor Cheung’s articles in recent years are often short of evidence, despite that the creativity still exists.

Advertisements

「中国的经济制度」

January 21, 2009

Professor Cheung has said this paper is another peak of his academic achievement.  It is thus very worthwhile to spend time to study this work.

I like the idea of adopting Contractual Arrangement as the theoretical basis for the concept is more comprehensive and fundamental compared to property rights, institutions (which are simply various types of contractual arrangement).   Using regional competition to interpret the growth of China is another powerful approach. 

I expect Cheung to go more in depth the role of government in marketization.  It also surprises me that the process of establishing necessary infrastructures (especially the legal and financial ones) is not covered.  The part on China’s monetary policy is interesting but there is obviously a lack of details, especially without touching how China has relaxed her capital control on a gradual basis.


Recent articles on economic recovery

January 13, 2009

Professor Cheung has recently written a series of articles of economic recovery. There are a few interesting issues that can be discussed.

1. He supported China’s government spending plan but insisted that Keynesian approach ought not be adopted;

2. 「金融机制出了大事,人民之间的财富会有转移,而不少财富可能蒸发了,但美国鼎盛的人材依旧,资源依旧,厂房楼宇依旧,江山也依旧——生产力当然不变。」Is it true that productivity really remain to be the same?

3. 浮沙指数——借贷与抵押的比率, should we blame 高浮沙指数given that the 指数is generated from the market? BTW, I would argue that 浮沙跟泡沫都是指同一樣的現象;

4. 「财富等于收入除以利率(W=Y/r),调整的机制过程可以很复杂,这里不说。财富(W)一下子暴跌,不回升,收入(Y)与利率(r)一定要调校。市场的利率(不是贴现率)向下调校不易:银行的借与贷皆不易(解释过了),而就是市场利率被政府所迫而下降,借贷难行这利率没有意思。余下来是收入(Y)的向下调校了。所谓收入,其实是物价乘产量(P x Q)。选择物价下降还是产量下降呢?当然选物价下降,因为物价只是交易的媒介,但产量却是人民享用的饭碗。以产量下降调校,苦不堪言也。」

Despite that both W and Y drop and r increases during the financial tsunami, I am not sure if the above logic flows (i.e. W drops and thus leads to…..).


My trip to Shenzhen

January 13, 2009

cheungmundell21Back in November, I was able to attend 佃農理論四十週年研討會. It has been my long time dream to meet with Professor Steven Cheung and it was finally fulfilled!! Cheung was very nice to us all and spent a lot of the time in answering questions that we asked, at both formal and informal meetings. It’s interesting to find out that scholars and economists who do not share his view are generally perceived by Cheung as not capable.

Cheung’s major contributions to economics are in two ways: his study of contractual arrangment (institution) and methodology. As transaction and information costs keeping altering under the continuous changes of technology and political constraint, any economic theory is subject to adjustment and modification. On the other hand, methodology is probably more ‘long lasting’ in terms of the sustainability. The ideas of

1. studying the real world constraints;

2. transaction costs should be measured in an ordinal sense;

3. avoidance of unobservable factors including utility;

4. theories must be testable;

5. downward sloping demand curve

are and will still be valid, if we insist on economic explanation. Sometimes I feel that even Professor Cheung himself finds it hard to keep up with the above in his recent articles.

Almost all the participants have been under heavy influence of Professor Cheung and his thinking. The ‘common background’ easily created a bond among us during the 3-day conference.  Individual speakers tended to focus too much on praising Professor Cheung instead of discussing about his thinking. Very few counter arguments or challenges about Cheung’s new paper on China could be heard throughout the event.

It would be great if similar conferences can be held in the future on a more regular basis. More rigorous discussions, if not debates, should be encouraged at future events.