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This article first provides a game-theoretic, endogenous view of institutions and then applies the idea to identify the sources of institutional trajectories of economies development in China, Japan, and Korea. It stylises the Malthusian phase of the East Asian economies as a peasant-based economies in which small conjugal families self-managed their working times between farming on small plots—leased or owned—and handcrafting for personal consumption and markets. It then compares institutional arrangements across these economies that sustained otherwise similar economies. It characterises the varied nature of the political states of Qing China, Tokugawa Japan and Yi Korea by focusing on the way agricultural taxes were enforced. It also identifies different patterns of social norms of trust that were institutional complements to, or substitutes for, the political states. Finally, it traces the path-dependent transformations of these state-norm combinations along subsequent transitions to post-Malthusian phases of economic growth in the respective economies.

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Socio-Economic Review
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Masahiko Aoki
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This paper analyzes the causes, responses, and consequences of the Fukushima nuclear power plant accident (March 2011) by comparing these with Three Mile Island (March 1979) and Chernobyl (April 1986). We identify three generic modes of organizational coordination: modular, vertical, and horizontal. By relying on comparative institutional analysis, we compare the modes' performance characteristics in terms of short-term and long-term coordination, preparedness for shocks, and responsiveness to shocks. We derive general lessons, including the identification of three shortcomings of integrated Japanese electric utilities: (1) decision instability that can lead to system failure after a large shock, (2) poor incentives to innovate, and (3) the lack of defense-in-depth strategies for accidents. Our suggested policy response is to introduce an independent Nuclear Safety Commission, and an Independent System Operator to coordinate buyers and sellers on publicly owned transmission grids. Without an independent safety regulator, or a very well established “safety culture,” profit-maximizing behavior by an entrenched electricity monopoly will not necessarily lead to a social optimum with regard to nuclear power plant safety. All countries considering continued operation or expansion of their nuclear power industries must strive to establish independent, competent, and respected safety regulators, or prepare for nuclear power plant accidents.

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Energy Policy
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Masahiko Aoki
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The fastest growing economy in the Association of Southeast Asian Nations (ASEAN) is the Lao People's Democratic Republic. For a decade Steve Parker has been intensively involved on behalf of USAID as a resident adviser on economic and related legal reforms, first in Vietnam and for the last three years in Laos. In each country he has focused on helping the government fulfill the requirements of membership in the WTO. Vietnam joined the WTO in 2007 and Laos followed suit on 2 February 2013. He is also advising the Lao government on meeting its obligations under the ASEAN Economic Community that is scheduled for inauguration in 2015, and on implementing the 2005 U.S.-Lao PDR Bilateral Trade Agreement.  

Parker will open this roundtable with some remarks on economic development and reform in the two ASEAN countries, including an assessment of the impact of WTO membership on economic development and reform—retrospectively in Vietnam, prospectively in Laos. An open discussion will follow.

In the course of his career in Asia as an economic specialist for the U.S. government and the Asia Foundation, Parker has been posted to Laos, Vietnam, Indonesia, and Japan with USAID, the ADB, and the Harvard Institute of International Development. The Southeast Asia Forum and the Stanford Center for International Development co-sponsored his last talk at Stanford in 2007: "The United States and Asia's Newest Tiger:  Trade, Aid, and Governance in Vietnam."

This seminar series is co-sponsored by

The Stanford Center for International Development

John A. and Cynthia Fry Gunn Building,
Doll Conference Room (#320)

Steve Parker Project Director and Resident Trade Advisor Speaker U.S.-Laos International and ASEAN Integration Project (LUNA-Lao) Managed by Nathan Associates Inc.
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"When you come to a fork in the road, take it." – Yogi Berra

Ambassador Bosworth will discuss some of the possible options for dealing with North Korea. This is a keynote speech open to the public during the Fifth Annual Koret Conference on "North Korea Policy."

Ambassador Bosworth is the Dean of The Fletcher School of Law and Diplomacy at Tufts University. A former career diplomat, he served as U.S. Ambassador to the Republic of Korea, the Philippines, and Tunisia. Most recently, he served as U.S. Special Representative for North Korea Policy for the Obama administration. 

This event is made possible by the generous support of the Koret Foundation.

Oksenberg Conference Room

Stephen W. Bosworth Dean of The Fletcher School of Law and Diplomacy Speaker Tufts University
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President Barack Obama awarded CISAC's founding science co-director Sidney D. Drell the National Medal of Science, the highest honor bestowed by the U.S. government on scientists, inventors and engineers. Drell was recognized for his research on quantum electrodynamics, which describes the interactions of matter of light, as well as applying basic physics to public policy, national security and intelligence. 

"Now, this is the most collection of brainpower we’ve had under this roof in a long time, maybe since the last time we gave out these medals," Obama said in the White House ceremony on Feb. 1. "I have no way to prove that, and I know this crowd likes proof. But I can’t imagine too many people competing with those who we honor here today."

Drell shared the White House stage with Stanford biologist Lucy Shapiro, a senior fellow, by courtesy, of CISAC's umbrella organization, the Freeman Spogli Institute for International Studies. Shapiro also advises CISAC as a member of its executive committee. She focuses on the dangers of emerging infectious diseases, antibiotic resistance and climate change.

Drell, a theoretical physicist for whom CISAC's annual public lecture is named, was appointed the science co-director alongside China expert John Lewis in 1983, when CISAC was initially established as Stanford's Center for International Security and Arms Control. 

Stanford News Story

Watch White House Video

Lucy Shapiro with President Obama at the White House ceremony.
Photo Credit: Ryan K. Morris

 

 

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In this talk, Mayling Birney presents evidence that China uses a distinctive form of governing, what she calls a “rule of mandates” in contrast to a rule of law. Under a rule of mandates, standards for accountability are relative rather than absolute, as lower officials are effectively directed to adjust the local implementation of the center's own laws and policies in order to meet the center's highest priorities. In China, this governing system has helped promote stability and growth, yet curtailed the potential impact of rule of law and democratic reforms. Birney demonstrates this impact by drawing on evidence from original surveys, interviews, and archival work. Yet she also explains why this governing system is likely to become more problematic for China in the future, potentially jeopardizing even the economic growth and stability it has thus far supported.

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Dr. Mayling Birney (London School of Economics) is a comparative political scientist with a special expertise in China. She is currently finishing a book about China’s distinctive form of authoritarian governing, in which she highlights its consequences for stability, justice, rule of law, and political reform. Prior to arriving at LSE, Dr. Birney was jointly appointed as a fellow in the Princeton University Society of Fellows and a lecturer in the Woodrow Wilson School.  She has also served as a fellow at the Brookings Institution and as a Legislative Aide in the United States Senate. She holds a PhD in political science from Yale University, an MSc in economics from LSE, and a BA in government from Harvard University.

Philippines Conference Room

Mayling Birney Lecturer, Political Economy of Development Speaker LSE
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Will China’s new leadership push through new financial reforms? The private sector is growing rapidly but private firms complain about their inability to get loans.  Reforms undertaken over the past 20 years have brought change, but much remains to be done. There are now many non-governmental banks and financial institutions operating in China, including foreign firms. But how effectively can they operate?   How open is China’s financial system to the non-governmental banks and to foreign participation? Are the challenges different for foreign firms?  How might foreign firms best cooperate with local firms as Chinese firms increasingly globalize?  Two bankers, James Chen, head of Hollyhigh International Capital, the first investment banking firm specializing in mergers and acquisitions (M&As) in Mainland China, and Carl Walter, recently retired Managing Director, JPMorgan Chase, China, will assess the changes in China’s financial realm. 

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James (Mingjian) Chen is the chairman of Hollyhigh International Capital, the first investment banking firm specializing in mergers and acquisitions (M&As) in Mainland China. He is also an adviser of the Beijing Olympics organization. Chen is a member of the liaison committee in the China National Democratic Construction Association, the chairman of the M&A Elite Club, as well as a member of the Fuping Foundation for poverty alleviation. He also serves as the chief editor of the China M&A Review, and has published Winning the Deal and M&A Revolution.

Chen graduated from Tsinghua University’s Department of Economics and Management in 1993. After graduation, he worked as a trader at China Great Wall Financial Company for several years. He then established Tsinghua Unisplendour and Hollyhigh Investment Company, in 1997 and in 1998 respectively. In addition to his work at Hollyhigh, Chen is actively engaged in M&A projects for international corporations, such as Lafarge, Shell, SK, and Scottish & Newcastle.

Chen’s deal between Teda and the Meilun Group was used as the first M&A case study at Tsinghua University. He has lectured at many renowned institutions, including Harvard University and the Economist Intelligence Unit.

Carl E. Walter worked in China and its financial sector for the past 20 years and actively participated in many of the country’s financial reform efforts. While at Credit Suisse First Boston he played a major role in China’s groundbreaking first overseas IPO in 1992, as well as the first primary listing of a state-owned enterprise on the New York Stock Exchange in 1994. He was a member of senior management at China International Capital Corporation, China’s first and most successful joint venture investment bank where he supported a number of significant domestic and international stock and bond underwritings for major Chinese corporations. More recently at JPMorgan he was China chief operating officer and chief executive officer of its banking subsidiary. During this time Walter helped build a pioneering domestic security, risk and currency trading operation.

A long time resident of Beijing before his recent return to the United States, Walter is fluent in Mandarin and holds a PhD from Stanford University and a graduate certificate from Peking University. He is the co-author of Red Capitalism: The Fragile Financial Foundations of China’s Extraordinary Rise as well as Privatizing China: Inside China’s Stock Markets.

Philippines Conference Room

Walter H. Shorenstein
Asia-Pacific Research Center
Encina Hall, Room E301
616 Serra St.
Stanford, CA 94305-6055

(650) 798-9129 (650) 723-6530
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Visiting Scholar
James_Chen_3x4.jpg

James (Mingjian) Chen is the chairman of Hollyhigh International Capital, the first investment banking firm specializing in mergers and acquisitions (M&As) in Mainland China. He is also an adviser of the Beijing Olympics organization. Chen is a member of the liaison committee in the China National Democratic Construction Association, the chairman of the M&A Elite Club, as well as a member of the Fuping Foundation for poverty alleviation. He also serves as the chief editor of the China M&A Review, and has published Winning the Deal and M&A Revolution.

Chen graduated from Tsinghua University’s Department of Economics and Management in 1993. After graduation, he worked as a trader at China Great Wall Financial Company for several years. He then established Tsinghua Unisplendour and Hollyhigh Investment Company, in 1997 and in 1998 respectively. In addition to his work at Hollyhigh, Chen is actively engaged in M&A projects for international corporations, such as Lafarge, Shell, SK, and Scottish & Newcastle.

Chen’s deal between Teda and the Meilun Group was used as the first M&A case study at Tsinghua University. He has lectured at many renowned institutions, including Harvard University and the Economist Intelligence Unit.

James Chen Chairman Speaker Hollyhigh International Capital
Carl Walter Former CEO Speaker JPMorgan Chase Bank China Co Ltd.
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Carnegie Corporation of New York, the foundation that promotes “real and permanent good in this world,” has awarded a $1 million grant to CISAC to fund research and training on international peace and security projects over the next two years. 

Specific areas of focus include research on strengthening communities in Afghanistan through collaborative civilian-military operations, several projects on improving nuclear security, and a study of community policing interventions to increase public safety and stability in rural Kenya. 

“The breadth and extent of Carnegie’s support will be crucial in advancing CISAC’s research and teaching to help build a safer world,” said CISAC Co-Director Mariano-Florentino Cuéllar

As part of a project funded in part by the Carnegie Grant, former Secretary of Defense William J. Perry, the Michael and Barbara Berberian Professor (emeritus) at FSI and the School of Engineering and a CISAC faculty member, and Siegfried S. Hecker – former CISAC co-director and professor (research) in the Department of Management Science and Engineering – will travel, consult and write on issues of nuclear security in Russia and China. Their goal is to increase technical cooperation between national nuclear laboratories in the United States and Russia. They will also pursue Track II dialogue with Pakistan to promote stability in South Asia.  

“It is crucial to promote cooperation with Russia and China on nuclear issues, both in terms of superpower relations and preventing nuclear proliferation and terrorism around the world,” Hecker said. “Bill Perry and I will continue to use our broad network of contacts to promote common approaches to reducing global nuclear risks.” 

Also in the area of nuclear security, Lynn Eden, CISAC senior research scholar and associate director for research, will take a hard look at the conflicting U.S. nuclear weapons strategy and policy for her project, “Vanishing Death: What do we do when we plan to fight a nuclear war?” Eden will focus on nuclear war planning and draw out the implications for future nuclear policies, including achieving a world free of nuclear weapons. She intends to publish her research with the goal of better informing the American public about the paradoxes and contradictions of U.S. nuclear weapons policy. 

“A historically informed public will be in a far better position to democratically participate in nuclear weapons policy debates, including questions of reducing the role and size of global nuclear weapons arsenals,” Eden said. 

The Carnegie grant also will enable CISAC senior research scholar Joseph Felter, a retired U.S. Army colonel, to assess and compare the effectiveness of counterinsurgency strategies and operations in the Philippines and Afghanistan. The former director of the Combating Terrorism Center at West Point and commander of the International Security Assistance Force’s Counterinsurgency Advisory and Assistance Team in Afghanistan, Felter has reported to the nation’s senior military officers and intends to generate a number of policy scenarios to be incorporated by the military. 

“CISAC brings scientists and engineers together with social scientists, government officials, military officers, and business leaders to collaboratively analyze some of the world’s most pressing security problems,” said Carnegie Corporation’s Patricia Moore Nicholas, project manager of the International Program.  “The original thinking and proposed solutions that emerge from these collaborations will help address a series of enduring and emerging challenges.” 

The funding for the project in Kenya will allow James D. Fearon, the Theodore and Frances Geballe Professor in the School of Humanities and Sciences and a CISAC affiliated faculty member to study the security sectors in Kenya, and then to use this research as a basis for developing effective strategies for peace building in other states in transition.

 

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