This talk is an overview of the changing role of foreign investment in Chinese workplaces. Foreign investment inflows helped transform the Chinese industrial landscape in the 1990s. As ownership has become blurred and increasingly mixed between domestic-foreign and public-private in China, preferential policies and laws for foreign-invested firms have diminished. A more level playing field has raised the stakes for foreign business and led to their increased participation in national debates on labor legislation and legal protections for workers. This talk will focus on this new role for foreign investors and how it is changing Chinese laws and the Chinese workplace.

Professor Gallagher studies Chinese politics, law and society, and comparative politics. She is currently working on two projects. The first, funded by a Fulbright Research Award and the National Science Foundation, examines the development of rule of law in China by examining the dynamics of legal mobilization of Chinese workers. "The Rule of Law in China: If They Build It, Who Will Come?" focuses on the demand-side of rule of law through an exploration of legal aid plaintiffs in Shanghai, a four-city household survey on legal knowledge, attitude, and practice, and in-depth case analysis of labor disputes. The second project examines labor standards and practices in four Chinese regions. One goal is to find if there are diffusion effects in legislation, court behavior, and labor practices across different regions. Another goal is to look for evidence of a "race to the bottom" in labor standards and social welfare not between China and other competing economies, but within China's own domestic economy.

This talk is part of the Stanford China Program Winter 2009 China Seminar Series titled "30 Years of Reform and Opening in China: How Far from the Cage?"

Peter Henry's research on emerging markets provides fundamental insights about the impact of economic reform on the lives of people in developing countries. It uses theory and data to grapple objectively with some of the most important and contentious economic questions of our time: Does debt relief help or hurt poor countries? Should emerging nations permit capital to flow freely in and out of their economies? Is it possible to reduce inflation without undermining economic growth? Peter's answers to these questions appear in the leading academic journals and have led him to testify before the U.S. Congress and various United Nations Ambassadors.

Peter is Konosuke Matsushita Professor of International Economics, the John and Cynthia Fry Gunn Faculty Scholar, and Associate Director of the Center for Global Business and the Economy at the Stanford University Graduate School of Business. He is also a Senior Fellow of the Stanford Institute for Economic Policy Research, a Research Associate at the National Bureau of Economic Research, a Nonresident Senior Fellow of the Brookings Institution, and a member of the Council on Foreign Relations. From 2000-2001 he was a National Fellow at the Hoover Institution. The National Science Foundation's Early CAREER Development Program supported his research and teaching from 2001-2006. In 2004 Peter participated in the Copenhagen Consensus, an international conference on how to make the most efficient use of the world's scarcest resources. The Economist magazine named the published proceedings of the conference one of the best business books of 2004.

Peter received his PhD in economics from the Massachusetts Institute of Technology in 1997. While in graduate school, he served as a consultant to the Governors of the Bank of Jamaica and the Eastern Caribbean Central Bank (ECCB). His research at the ECCB contributed to the intellectual foundation for establishing the first stock market in the Eastern Caribbean Currency Area.

Prior to attending MIT, Peter was a Rhodes Scholar at Oxford University where he received a BA in mathematics and a Full Blue in basketball. He also holds a BA in economics from The University of North Carolina at Chapel Hill where he was a Morehead Scholar, a National Merit Scholar, a member of Phi Beta Kappa, a Marshall Scholar-Elect, a reserve wide receiver on the varsity football team, and a finalist in the 1991 campus-wide slam-dunk competition.

Born in Jamaica, Peter became a U.S. citizen in 1986. His wife of 12 years, Lisa J. Nelson, received her BA and MD from Yale University. She is a child psychiatrist and was a Glaxo Welcome Fellow of the American Psychiatric Association from 1995 to 1997. They have four sons: Christian Blair, Langston Alexander, Hayden Montgomery, and Harrison Elbert.

Japan's industrial landscape is characterized by hierarchical forms of industry organization that are increasingly inadequate in modern sectors, where innovation relies on platforms and horizontal ecosystems of firms producing complementary products. Using three case studies--software, animation and mobile telephony--two key sources of inefficiencies that this mismatch can create will be illustrated.

First, hierarchical industry organizations can "lock out" certain types of innovation indefinitely by perpetuating established business practices. Second, even when the vertical hierarchies produce highly innovative sectors in the domestic market, the exclusively domestic orientation of the "hierarchical industry leaders" can entail large missed opportunities for other members of the ecosystem, who are unable to fully exploit their potential in global markets.

Dr. Hagiu will argue that Japan has to adopt several key measures in order to address these inefficiencies and capitalize on its innovation: strengthening antitrust and intellectual property rights enforcement; improving the legal infrastructure (e.g. producing more business law attorneys); lowering barriers to entry for foreign investment and facilitating the development of the venture capital sector.

Andrei Hagiu is an Assistant Professor in the Strategy group at Harvard Business School. His research focuses on multi-sided markets, which feature platforms serving two or more distinct groups of customers, who value each other's participation. He is studying the business strategies used by such platforms and the structure of the industries in which they operate: payment systems, advertising supported media, personal computers, videogames, mobile devices, shopping malls, etc. Hagiu is using the insights derived from this research to advise a wide range of companies in all of these industries.

In addition, he is also involved in competition and industrial policy research and advisory projects, in Japan, China and in the United States. He graduated from the Ecole Polytechnique and the Ecole Nationale de la Statistique et Adminstration Economique in France with an MS in economics and statistics, before obtaining a PhD in economics from Princeton University in 2004. Prior to joining HBS, he spent 18 months in Tokyo as a fellow at the Research Institute of Economy Trade and Industry, an economic policy think-tank affiliated with the Japanese Ministry of Economy Trade and Industry.

This event is presented in conjunction with the Japan Society of Northern California.