Here is my view on a post written by HK Dave in simonworld
The original post is here.
The title is "Chinese and Indian Models", the question was which is better?
Below is my answer:
Dave, I think that I agree with you on most of points.
But I don't think the comparison between India and China is fair enough. India had never been one united nation in history until the independence. I couldn’t imagine what will happen to China if we also have as many religions and languages as Indians have. Never mention they used to divide people in term of brahman, kshatriyas, vaisyas, sudras and harijan. Perhaps India never united culturally, while Chinese characters bond Chinese much more closely together than English does for India. Still China’s gotten localized capital flow and protectionism today, which are probably not so good for a market economy. Not to mention that dictatorship also has given China great starving period and culture revolution. Considering all these facts, I admire what India has done so far.
The famous local Hongkonger economist Steven Cheung doesn’t like democracy too much because he considers the transaction fee is too high for a business under the democracy. Of course he got tons of examples from today’s development in China. However if we jump up one level and focus on the big picture we found Steven Cheung’s theory need a very important prerequisite: a smart and benign dictator. Otherwise if count all social costs in the first 30 years of PRC as the transaction fee in his theory, he probably will lose all his pants.
Amartya Sen has an article called “Democracy as a Universal Value”, which has been very popular in China. I guess Sen is right unless Cheung comes up with some other mechanism to generate a smart and benign dictator, which probably is GOD.
Right now looks like China is doing better. However the nature of authoritarian regime decides that the economic development will be fast only if the governing group do things right, but the disaster will be huge in case the governing group do things wrong. That’s why I mentioned that perhaps we need at least another 50 years to tell which model is more successful. There is a possibility that we may never know which model is better. Consider the economic development under authoritarian regime is an upward wave with big fluctuations, (just like what Chicago boys did for Chili) while the economic development under the democratic regime is also upward wave but with only small fluctuations. (Botswana, a good example? I am not sure…) Only by averaging out the fluctuations for a big enough data set, we can get slopes and compare them. Apparently this may never be achieved in reality.
The title is "Chinese and Indian Models", the question was which is better?
Below is my answer:
Dave, I think that I agree with you on most of points.
But I don't think the comparison between India and China is fair enough. India had never been one united nation in history until the independence. I couldn’t imagine what will happen to China if we also have as many religions and languages as Indians have. Never mention they used to divide people in term of brahman, kshatriyas, vaisyas, sudras and harijan. Perhaps India never united culturally, while Chinese characters bond Chinese much more closely together than English does for India. Still China’s gotten localized capital flow and protectionism today, which are probably not so good for a market economy. Not to mention that dictatorship also has given China great starving period and culture revolution. Considering all these facts, I admire what India has done so far.
The famous local Hongkonger economist Steven Cheung doesn’t like democracy too much because he considers the transaction fee is too high for a business under the democracy. Of course he got tons of examples from today’s development in China. However if we jump up one level and focus on the big picture we found Steven Cheung’s theory need a very important prerequisite: a smart and benign dictator. Otherwise if count all social costs in the first 30 years of PRC as the transaction fee in his theory, he probably will lose all his pants.
Amartya Sen has an article called “Democracy as a Universal Value”, which has been very popular in China. I guess Sen is right unless Cheung comes up with some other mechanism to generate a smart and benign dictator, which probably is GOD.
Right now looks like China is doing better. However the nature of authoritarian regime decides that the economic development will be fast only if the governing group do things right, but the disaster will be huge in case the governing group do things wrong. That’s why I mentioned that perhaps we need at least another 50 years to tell which model is more successful. There is a possibility that we may never know which model is better. Consider the economic development under authoritarian regime is an upward wave with big fluctuations, (just like what Chicago boys did for Chili) while the economic development under the democratic regime is also upward wave but with only small fluctuations. (Botswana, a good example? I am not sure…) Only by averaging out the fluctuations for a big enough data set, we can get slopes and compare them. Apparently this may never be achieved in reality.
posted by BFF @ 3:51 PM
1 Comments:
At 1:15 AM,
Sun Bin said…
imho democracy might be relevant in the longer term, or may not. but in most examples it is not crucial in the developement of developing countries. i said this mainly based on observations, without rigorous logically basis. however, many people have argued that the foundation for economic development is liberty (sort of 'freedom'), in view of that, China is actually very free. but india not as free (i have a theory blaming India's caste system for dragging down the productivity in my blog), i guess all these are open to debate at this point of time.
note china is relatively much cleaner than india in terms of corruption, esp since 1998.
i found cheung's claim that "democracy is not well defined" interesting, esp when one think about the difference between a democracy with high degree of corruption (India, Philippines, Indonesia) and those which are very clean (US, Singapore, Europe). Can corruption corrupt democracy? If so, how can we save this sub-category of democracy? If GDP/cap chicken or egg to solving the corruption problem? (Singapore seems to show that corruption needs to be dealt with first).
btw, you have a great site.
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