The Political Economy of Guyana’s Underdevelopment

Using a history-inspired game theoretic approach, the paper shows how dictatorship and pro-ethnic voting under democracy, in a society characterized by bi-communal polarization, can result in sub-optimal economic performance. The relatively poor economic outcome is facilitated by an adverse institutional construct, the constitution, which inadvertently encourages low intensity but persistent ethnic rivalry. Mutual distrust in how the other side will vote on the day of secret ballot induces the members of each group to vote for their respective elites, hence non-cooperation. The model is extended to include Gintis’ psychic gain parameter that shows cooperation is possible in the prisoners’ dilemma framework. The latter theoretical result implies a policy proposal of constitutional reform that promotes inter-group cooperation of the distribution of economic resources.     

Hurricane Katrina: Was There a Political Economy of Death?

An empirical implication of egalitarianism in the provision of public disaster relief services is that the probability of surviving a natural disaster should not be conditioned on a household’s position in the income distribution, or its racial characteristics. In this paper, we utilize data on deaths attributed to Hurricane Katrina in the City of New Orleans to estimate a political economy model of the public provision of disaster rescue services. Parameter estimates reveal that the probability of dying as a result of Hurricane Katrina, at both the census tract and individual level, increased with respect to being black and poor. Our results suggest that there was a departure from egalitarian principles in the provision of public disaster rescue services during Hurricane Katrina, and are consistent with a political economy of race and class governing decisions about the allocation of public resources to ameliorate population environmental risks.

The “Huangpu Military Academy”of Chinese Football

There is not a football team without complaints,but almost everyone who has been to Luneng Taishan Football School or heard about it will compliment it without any hesitation or reservation.A Yan Shiduo, the former president of the Chi-nese Football Association (CFA), and Xie Yalong,the present president of CFA, both have fullypraised Luneng Taishan Football school.With the decline of the Chinese football mar-ket after the World Cup of 2002, when footballschools disappeared overnight,…     

Reform of Labor Policy in China：A Perspective of Political Economy

Ⅰ. IotroductionLike other related institutional arrangments in China,labor policy under the planned economic system re-sulted in two kinds of inefficiency. First, the inherentlack of labor supervision and lack of an incentivemechanism in the micro-management system led to lowtechnical efficiency. Second, the distorted allocation of     

Dynamics of Environmental Regulation and Voters’ Biased Beliefs: A Political Economy Approach

This paper develops a political economy model which determines the conditions of cycles in environmental regulation. It analyzes the impact of both interest groups and voters who have biased political beliefs. Such biased beliefs are the result of the influence of activist interest groups that strategically use the beliefs formation process among ignorant voters (cascade effect). The cascade effect biases the perception of the efficiency of regulatory instruments and affects the behavior of the politician. Our model seems particularly relevant to explain the evolution of environmental policies, which are characterized by scientific controversies, such as climate change policies. The high media coverage of climate issues, as well as persistent debates among experts, is a favorable context for the influence of activist interest groups that use the public’s cognitive biases.     

Has Fiscal Federalism Worked for Macroeconomic Purposes？ The Chinese Experience 1994-2003

China＇s central government undertook major tax regime reform in 1994 that was characterized by fiscal federalism. In hindsight, this reform might be viewed as being more emphatic towards the revenue side than the expenditure side. The reform has resulted in certain success both for revenue shifting and inflation fighting purposes. However, the reform and its subsequent follow-ups have not addressed some fundamental issues pertaining to China＇s government finance system, such as the overhauling of the function of government finance and redrawing lines between the central and regional governments with regard to their fiscal responsibilities and duties. Moreover, fiscal federalism might have actually increased fiscal burden on the economy, especially on domestic sectors of the economy. However, coupled with enhanced policy support for China＇ s external development, fiscal federalism might have helped to further accelerate resource shifts toward the external sector, thus resulting in an unprecedented rapid expansion in China＇ s exports since the mid1990s.     

The Economy of Territories Reformed into Statehood: The Donetsk People’s Republic

Recent sociopolitical processes are showing a trend towards the formation of an increasing number of new states with truncated political status. The Donetsk People’s Republic (DPR) is an example of this kind of territory. The presented material allows us to evaluate the economic situation, compounded by military operations, in order to see the current problems faced by the DPR and outline ways to resolve them.     

The Scholarly Status of Blacks in the Economics Profession: Have the National Economic Association and the Review of Black Political Economy Mattered?

This paper considers whether the National Economic Association and its journal the Review of Black Political Economy have enhanced the scholarly status of black economists. A bibliometric analysis reveals that while the typical black economist has never published in the Review of Black Political Economy, the share of black economists publishing in the Review of Black Economy approximates the share of all articles published on the economic and political economy of race by black economists, and the share of articles published in the Review of Black Political Economy by black economists appears higher than typical journals in economics—particularly for black economists employed at Historically Black Colleges and Universities. We also find that similar to other economics journals non-black economists dominate the share of published articles, and publications in the Review of Black Political Economy appear to be consistent with Lotka’s Law of scientific productivity suggesting that the journal is a standard outlet for research no different from any other science journal. Our results imply a plausible counterfactual that if the National Economic Association and Review of Black Political Economy did not exist, the scholarly status of blacks in the economics profession would have been lower than currently observed.     

Urbanization: The Chinese Way

I.IntroductionChina’s urban population reached39.1percent by theend of2002,up from the rateof36.22percentin2000,and achievedtheworld’saveragelevelfordevelopingcountries(CCTVprogram,11/12/03).Thebenefitsofasuccessfulurbanizationaremany-fold,including,forexample,creatingnon-farmjobs toalleviateurban-ruralincomedisparity,promotingeconomicand socialequality,and boosting domestic demand,especially the potential demand of China’s rural residents.Urbanization thusbearsdirectlyon thesustainabilit…     

Empirical Analysis on Growth of Chinese Private Economy and Elasticity of Employment

This paper expatiates on the relationship between growth of Chinese private economy aria employment through the theory of elasticity of employment in economics. In the paper, the author has applied methods of empirical analysis to explain that the growth of Chinese private economy boosts employment and also probed into its political implication.     

The Relationship of Network Economy and Economic Growth

This paper begins with the characteristics of network economy, theoretically analyzes how networks change economic growth mode, then illustrates how networks promote it thus achieving dynamic equilibrium of national economy consequently.     

The RMB/US Dollar Exchange Rate——An International Political Economy Perspective

I. IntroductionOn July 21, 2005, China unexpectedly appreciated the RMB by 2 percent, and declared themoving of the RMB exchang rate regime into a managed floating regime, with reference toa basket of currencies. This brought respite to the long, ongoing debate over RMB’sappreciation. Due to the fact that the exchange rate is always considered a technical matter,best left to economists to handle, the mainstream approach of the RMB discussion is theeconomic approach. Although reviewing d…     

Building an Entrepreneurial Economy: The Case of Korea 1998–2005

Abstract

This paper examines how entrepreneurship takes place in an economy where traditional structural settings are not favorable to entrepreneurial activities. Specifically, it investigates the case of Korea during 1998–2005, when the national economy experienced fairly dramatic upsurge of start-ups and related changes. The paper argues that a national economy may achieve significant structural changes when diverse conditions are in place, including not only intentional efforts, e.g. governmental policies, but factors of serendipity triggering potential disruption to the economy, e.g. an external shock such as the Asian financial crisis in 1997. During the observation period, Korea went through notable changes in terms of entrepreneurship. Although limited, the Korean economy looks at possibilities of having small and medium-sized companies co-evolve with large ones such as chaebols.     

Is the Chinese Economy Moving in the Direction of Tertiarization？

Drawing upon output, employment, consumption and trade data, this article examtnes whether there is an economic tertiarization trend in China ＇s economy and evaluates the common factors driving current trends. It shows that the tertiarization trend is evident for the overall economy and most regions in terms of the service nominal value-added ratio and service employment and consumption. However, the tertiarization trend is not significant in terms of the service real value-added ratio, and there is even some concurrent ＂detertiarization ＂ because of the decreasing proportion of services in imports and exports. lndeed, China ＇s tertiarization trend is far behind its industrialization trend The rise in the relative prices of services explains the rising proportion of household service consumption expenditure and further illuminates why the service real value-added ratio has not grown. The main cause for the growing percentage of service employment is the lag in service labor productivity growth in interaction with the price inelasticity of service demand ＂Cost disease ＂ has appeared in service consumption.     

Political Economy of the Asia-Pacific Free Trade Area： A Dilemma for China

The Asia‐Pacific Free Trade Area (FTAAP) has become a topic of focus since the proposal was first raised in 2004. The present paper considers China's policy towards the FTAAP from a political economy perspective by probing the gains, impediments and concerns for China, and makes judgments based on several possible scenarios. The author argues that from an economic perspective, China would benefit from joining the FTAAP both in a static and a dynamic manner because both its main trade partners and trade barriers in export markets are concentrated in the Asia‐Pacific region. However, whether the Chinese Government is likely to support the initiative is largely dependent on certain crucial political and diplomatic elements, including the APEC approach, US‐Chinese relations, quality of treaty, sensitive sectors, competitive proposal of alternative and membership of Chinese Taipei. Therefore, if the Chinese Government cannot ratify the ideology and terms of the initiative, or issues that are central to China's interests are not addressed, the FTAAP will only remain a proposal possessing economic possibility in the long run, without political feasibility in the near term.