Peking University, Nov 7, 2011: From November 4 to 6, 2011, the Economics Sub-forum of Beijing Forum was held in Diaoyutai State Guest House and Yingjie Overseas Exchange Center in Peking University. This 3-day Sub-forum, centering on the theme “Economic Growth in the Context of Globalization: Opportunities, Challenges and Perspectives”, has drawn much attention both from home and abroad, since the very beginning.
The Economics Sub-forum is always considered as one of the most fascinating parts of the Beijing Forum, for there will be cutting-edge speeches and heated discussion from time to time. So was this year’s Economy Panel.
Group photo of participants
As is known to all, the subprime mortgage crisis erupted in U.S in 2007, and then swept throughout the world. 2011 is the fourth year after the explosion of the global financial crisis, however, the global economy is still strapped by the crisis, and the U.S economy is under weak recovery, while the European debt crisis is remaining deterioration. Therefore, everyone would wonder: Where is the transformation direction? In which way China and the whole East Asia Region should go to initiate the transformational development? Based on this, as well as the background that the global economy is still under crisis, the Economics Sub-forum has been mainly divided into three topics.
Firstly, it reflected whether there should be profound revolution towards the anti-crisis guiding ideology and macroeconomic theory. Secondly, the Economics Sub-forum discussed the global, especially China’s future transformation directions, through three dimensionalities which were the regional integration, transformation and revolution, and also the sustainable development. Finally, it also tried to figure out the specific way of keeping continued rapid economic growth through some empirical and microscopic points of view, such as the aging population, the Voluntary Environmental agreements, and the construction of the Security House, etc.
As far as what the reporter has observed is concerned, the 3-day Economics Sub-forum has covered many areas, varying from macro-economics to micro-economics, from stock market to labor market, from world to China… 3 days, 4 sessions featuring on 4 themes, 33 academic speeches and 7 heated discussions (or should call it debate?), expressed the latest points of view from top economists from all over the world. Here is the report of Session One: Global Liquidity Management and Economic Growth.
Justice Matters
Professor Daniel Little (University of Michigan, USA) has pointed out in his speech Justice Matters in Global Economic Development that, the matter of fairness under the background of globalization was quite concerning, meanwhile, justice required putting human welfare and freedom first, eliminating the extreme poverty as well as food supply insecurity and famine, also weakening the power’s group’s oppression towards the vulnerable groups. He also emphasized that global economics fairness could be realized by consensual regimes and agreements.
Be aware of Technology & Debt
Professor Giorgio Dominese (University of Tor Vergata, Italy) focused on the connection between the growth of economics and the appliance of science and technology under the background of liquidity insufficiency in Europe. Woo Jaejoon from the Financial Affairs Department of the International Monetary Fund found out that high public debt would result in reduced investment and slower growth of capital stock, which would impose a negative effect on long-run economic growth.
Collaboration & Save Euro
Professor Inchul Kim (Sung Kyun Kwan University, Korea) attached great significance to construct a frame of 13 countries in East-Asia taking part in the region union to keep the exchange reserves etc. Professor Gertard Illing (University of Munich, Germany) suggested that facing the crisis of Euro, people should establish an incentive compatible governance structure to attract more liquid investment instead of abolishing the Euro, which would cause financial disorder, and he also raised solutions from the aspects of short, medium and long term runs.
Japanese Way & Theories
Professor Shigeki Tejima (Nidhogakusha University, Japan) and Professor Gary H. Jefferson (Brandeis University) researched into the overseas investments of Japanese and Chinese corporations. Shigeki Tejima thought Japanese corporations had advantages in both price and quality. He also discussed the impact on their impact on their ability to compete caused by investment, indicating the task to be achieved by Japanese firms through the organizational reforms in both domestic and overseas business and through their creating a new type of innovation, whereas Professor Jefferson used the comparison of Cobb-Douglas function and translog to make a conclusion of impacts on productivity of horizontal, upstream and downstream spillovers. Meanwhile, Professor Kim Jae-hoon from the Economic and Financial Institute of Australia La Trobe University came up with Stock Return Predictability and the Adaptive Markets Hypothesis, based on the evidence from century-long U.S data illustrating from the perspectives of market crashes, crisis and bubbles.
Right after the speeches regarding a wide range of topics, a final discussion was held. The first question was raised on the justice problem. Professor Daniel Little took China as an example to support his opinion that regime choosing is crucial and significant towards the justice realization. Professor Woo Jeajoon responded the debt problem saying that from the long term view, the debt increase still could have a negative impact on economic growth, which was not the contrary of Keynes theory of short term. Also, Professor Gerhard Illing proposed that government investment towards public facilities would advance the economic growth, and the countries of small financial spaces should refrain from over-consumption.
Global VS Regional
What can be concluded is that no matter what kind of economic problem is going on at present; one thing is for sure that those problems can’t be considered separately. What the first secession was trying to discuss is that globally or regionally, economic growth lies in collaboration from all economic communities and countries. Also, when analyzing the current economic situation, both theory and practice are needed to be taken into consideration together. People should learn from the financial and economic crisis of 2008-2009 and beyond, try to work out the out together, thus can lead everyone the way to a relatively stable economic growth.
Reported by: Qian Xin
Source: Beijing Forum
