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As nations grapple with an increasingly competitive global talent landscape, a new study, published in the journal World Development, suggests that countries should rethink their approach to developing, attracting, and retaining talent. To address the need for a more complete understanding of cross-national variation in talent development strategy, the study proposes Talent Portfolio Theory (TPT), a novel approach to studying and improving human resource development.

The researchers, Stanford sociologist Gi-Wook Shin, the William J. Perry Professor of Contemporary Korea and the director of APARC and the Korea Program, and Haley Gordon, a PhD candidate at Stanford’s Department of Sociology, draw on the principles of Modern Portfolio Theory, a well-established framework in financial investment literature, to propose a new framework for talent development.

The new framework, TPT, views a nation’s talent strategy much like an investment portfolio, emphasizing the importance of diversification, risk management, and rebalancing. Shin and Grodon examine Japan and Singapore as case studies to illustrate how the TPT approach can help scholars, policymakers, and businesses better understand and optimize talent development strategies.

The study is part of the Talent Flows and Development research track of the Stanford Next Asia Policy Lab (SNAPL). Housed at APARC and directed by Shin, SNAPL is a new initiative committed to addressing emergent social, cultural, economic, and political challenges in Asia-Pacific nations through interdisciplinary, policy-relevant, and comparative research.

Talent Portfolio Theory enables a holistic understanding of a nation’s talent development. TPT also allows us to see the evolution of talent development strategy in terms of rebalancing a talent portfolio over time.
Gi-Wook Shin and Haley Gordon

A Fresh Perspective on Talent Development

Talent development has long been a priority for nations aiming to boost economic growth and compete globally. Traditionally, countries have focused on building human capital — developing skills and education among citizens — and social capital — strengthening networks and relationships that facilitate cooperation and innovation. Existing strategies, however, often overlook the interconnected nature of various talent flows, including the movement of domestic talent, international talent, and diaspora engagement.

Just like financial theory evaluates a given investment (and its risk and return qualities) by how it impacts a portfolio’s overall performance rather than in isolation, TPT treats talent as a portfolio composed of four key elements, known as the “four Bs”: brain train (domestic talent development), brain gain (attracting foreign talent), brain circulation (movement of talent between home and abroad), and brain linkage (engagement with diaspora communities).

“In the study of national talent development, it is imperative to consider both the human and social capital facets of talent, as a country has multiple layers of talent available for use – domestic, diasporic, and foreign – each with different human and social capital potentials,” write Shin and Gordon. They propose TPT as “a better framework for illustrating and comparing different experiences and impacts of talent development at the national level, which is also key in offering policy prescriptions for human resource strategies.”

Talent Portfolio Theory allows for a comparison between Singapore and Japan, [...] explaining how timely rebalancing to maintain diversification enabled the former to sustain success while the latter stagnated, succumbing to risk.
Gi-Wook Shin and Haley Gordon

Insights from Japan and Singapore

Using Japan and Singapore as case studies, the authors demonstrate how countries can apply TPT to manage their talent portfolios. Japan's economic growth relied on two tiers of human capital: top-level scientists and engineers who adapted and integrated foreign technologies for domestic use, and skilled workers who grasped the fundamentals of these adapted technologies and carried out the manufacturing processes. With limited prospects for brain gain, circulation, or linkage, Japan developed these two layers of its workforce by relying on brain train, cultivating domestic talent for its industrial development.

In the early 1990s, however, Japan’s economy ran into trouble. Its system of brain train was well-suited for driving incremental innovation, but it became restrictive in the rapidly evolving landscape of the early 21st century, which demanded more disruptive innovation. “The Japanese model of human resource development necessitated a robust supply of domestic manpower which now became increasingly difficult to sustain, and a shrinking working-age population also meant labor shortage and reduced productivity,” say Shin and Gordon. “In the language of TPT, Japan urgently needed to diversify its talent portfolio beyond its reliance on brain train to address new risks.”

Recognizing the risks of a skewed talent portfolio, Japan began to rebalance its talent portfolio in the 2010s but has struggled with demographic decline and a slow pivot toward international talent. Despite efforts to internationalize higher education and attract foreign talent, Japan’s diversification of its talent portfolio has been stagnant and was hard hit by the COVID-19 pandemic.

In contrast, Singapore’s approach showcases the benefits of a well-balanced talent portfolio. The city-state’s aggressive pursuit of foreign talent (brain gain) and robust engagement with its diaspora (brain linkage) have made it a leader in global talent strategy. Singapore’s government has continually adjusted its policies, actively rebalancing its talent portfolio to maintain a competitive edge.

Singapore started rebalancing its talent portfolio in the 1990s, not only enhancing its efforts toward brain train but also expanding brain gain by internationalizing higher education and actively promoting a “work-migration” path. In tandem with its brain gain initiatives, Singapore also turned to its diaspora, fostering brain circulation and establishing stronger brain linkages. Through concerted efforts by the government and industry, Singapore has successfully produced and attracted creative talent that allowed it to remain globally competitive.

“Talent Portfolio Theory enables a holistic understanding of the various components of Singapore’s talent strategy and its evolution over time, from the country’s focus on brain train during its catch-up phase to its rebalancing with a successful brain gain, in addition to more recent forays into brain circulation and brain linkage,” Shin and Gordon explain.

Countries must enact sociocultural policies that ensure global competitiveness in the new talent market by emphasizing openness, tolerance, and diversity in order to gain the best and brightest brains.
Gi-Wook Shin and Haley Gordon

Toward Fostering Cultural Diversity

TPT offers a powerful framework for crafting more resilient and adaptive talent strategies. As the global competition for skilled workers intensifies, understanding the dynamics of talent portfolios can help countries mitigate risks, capitalize on opportunities, and avoid the pitfalls of overly narrow approaches to human resource development. For instance, countries experiencing demographic decline, like Japan, can look to Singapore’s model of timely rebalancing as a guide for policy adjustment. Businesses also stand to benefit from TPT. The framework encourages companies to look beyond the availability of local talent and consider the broader talent ecosystem, including international talent flows and diaspora engagement.

Shin and Gordon emphasize that structural and sociocultural factors often limit policy options for building and rebalancing talent portfolios. Japan and Singapore illustrate that developed countries with abundant domestic opportunities are better positioned to retain talent and attract brain gain, whereas developing countries often experience talent outflows, favoring brain circulation or linkage (as seen in China and India). Additionally, while ethnically homogenous countries like Japan may prefer to rely on domestic and diasporic talent, multiethnic countries like Singapore can better attract foreign talent and engage in brain gain.

The contrasting experiences of Japan and Singapore underscore the critical importance of fostering cultural diversity to attract foreign talent. Singapore’s success with brain gain, compared to Japan’s more mixed outcomes, largely stems from its multicultural environment, shaped by policies that protect minority rights and actively promote respect for diverse ethnic groups. To remain competitive in the global talent market, countries must prioritize sociocultural policies that cultivate openness, tolerance, and diversity. By embracing these values, nations can attract the best and brightest minds, ensuring their place in a rapidly evolving global economy.

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Stanford researchers Gi-Wook Shin and Haley Gordon propose a novel framework for cross-national understanding of human resource development and a roadmap for countries to improve their talent development strategies.

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Highlights 

  • Talent Portfolio Theory is a new framework for studying human resource development.
  • Talent portfolios use brain train, brain gain, brain circulation, and brain linkage.
  • National talent strategies involve portfolio diversification and rebalancing.
  • Talent Portfolio Theory allows cross-national comparison of talent strategy over time.
  •  While Japan stagnated, Singapore sustained growth by rebalancing its talent portfolio.


In this article, the researchers propose Talent Portfolio Theory (TPT) as a new framework for studying human resource development. Drawing insights from Modern Portfolio Theory in financial investment, TPT views a nation’s talent development as creating a “talent portfolio” composed of four “B”s: brain train, brain gain, brain circulation, and brain linkage. TPT attends to how a talent portfolio, like a financial one, is diversified to minimize risk, and how diversification can be maintained via rebalancing. As such, TPT provides a framework that captures the overall picture of a country’s talent strategy and offers a lens through which to understand how a country changes or “rebalances” its talent portfolio over time. It also provides a tool for examining cross-national variation in talent development strategy.

The authors illustrate the utility of TPT with the cases of Japan and Singapore. While human resource development was crucial to the economic rise of both countries, TPT demonstrates that Japan’s and Singapore’s approaches to constructing and rebalancing their talent portfolios took different routes with diverging outcomes. They conclude with discussions of theoretical and policy implications of this new approach for the study and implementation of talent development.

This study is part of the Talent Flows and Development research track of the Stanford Next Asia Policy Lab.

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Insights from Financial Theory, Illustrations from the Asia-Pacific

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World Development
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Gi-Wook Shin
Haley Gordon
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As right-wing populism surges around the world, immigrants and their descendants often face discrimination and become targets of political scapegoating. Yet, the question of which groups of immigrants are targeted by anti-immigrant rhetoric is dependent on a host of factors, and there remains a lack of clear evidence on the reasons underlying xenophobic behavior and the othering of immigrant populations.

A new study, published in the American Political Science Review, introduces a novel international relations perspective, particularly the concept of geopolitical rivalry, into the literature on anti-immigrant sentiment. The study indicates citizens strongly prefer immigrants from non-rival countries over those from rival countries.

The study’s co-authors — including Kiyoteru Tsutsui, APARC deputy director and director of APARC’s Japan Program and Dartmouth College’s Charles Crabtree, a former visiting professor with the Japan Program, shift the research focus of anti-immigrant sentiment to the political dynamics between the immigrants' countries of origin and the destination countries. In doing so, the authors emphasize the importance of going beyond the existing preoccupation with the individual background characteristics of migrants and integrating the study of xenophobia within the global context of political competition and alliances.

Geopolitical Relations and Public Perceptions 

Traditionally, research on anti-immigrant attitudes has concentrated on factors such as race, culture, and labor market impacts. By contrast, Tsutsui and his co-authors build on the view that the political relations between immigrants’ origin and host countries shape citizen attitudes toward them. The researchers draw on this international relations perspective to argue that immigrants (as opposed to refugees) from countries with contentious or conflictual relationships with the host country are generally less welcomed than those from allied nations.

In each of the survey countries, immigrants from non-rival countries are strongly preferred over those from rival countries
Tsutsui et al.

To test this argument, the researchers used a method known as a forced-choice conjoint experiment, a technique whereby social scientists present survey participants with a series of hypothetical scenarios in which they must choose between two or more options — in this case, potential immigrants — each described by a set of varying attributes. Tsutsui and his co-authors had survey participants choose between two candidates for permanent residency, differentiated by their country of origin and various other attributes typically used in experiments to determine if labor market concerns outweigh preferences for specific immigrants.

The researchers fielded the experiment with nationally representative samples in 22 democracies, mostly in Europe and the Americas but also Asia and South Africa. They assigned four countries of origin to the immigrant profiles: two countries of origin with a similar racial and cultural make-up as the majority of the survey respondents, a rival country and an ally; and two countries with a different racial and cultural make-up.

The results strongly support the geopolitical rivalry argument: “In each of the survey countries, immigrants from non-rival countries are strongly preferred over those from rival countries,” the co-authors write. “The effect is so large that it results in a net preference for immigrants from countries with a dissimilar racial and cultural makeup than the majority of the host country.”

The researchers also show that the greater the respondents’ sense of their own country’s superiority, the stronger the international relations of their governments are mirrored in their preferences for immigrants. Furthermore, they find that members of ethno-racial majorities are more prone to the rivalry effect because they are more strongly identified with their nation compared to minority members.

The authors demonstrate that, for instance, in Western Europe, immigrants from Russia are less favored, while in East Asia, Chinese immigrants face similar hostility. This animosity towards immigrants from rival nations leads to a net preference for those with different racial or cultural backgrounds compared to the more favorable reception of immigrants from allied countries.

“The mechanisms we document in this article play an important part in the overall dynamic leading to the selective rejection or acceptance of immigrants,” Tsutsui and his colleagues summarize.

Addressing Anti-Immigrant Sentiment

In their empirical analysis, the researchers found minimal evidence of broad anti-Asian sentiment or “Sinophobia” beyond the effects of political rivalry. This conclusion holds consistently across various survey countries, continents, and immigrant origin countries. The detailed examination by survey country indicates that generalized racial or cultural biases did not significantly influence the observed preference for immigrants from politically aligned countries. The authors propose that future research expand the sample of survey countries, update and refine measures of political rivalry, and include a broader range of immigrant origins.

The study offers a new lens connecting geopolitical rivalries with xenophobia, providing a more nuanced understanding of public attitudes toward immigrants. Policymakers and researchers can use this framework to better anticipate and address potential backlash against immigrants from countries with politically contentious relations. Informed immigration policies that promote multiculturalism and social inclusion start with a deeper grasp of the forces shaping public perceptions and attitudes toward immigrants.

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Researchers including Stanford sociologist Kiyoteru Tsutsui, the deputy director of APARC and director of the Japan Program at APARC, find that geopolitical rivalries and alliances significantly shape citizen perceptions of immigrants.

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The Stanford Next Asia Policy Lab (SNAPL) has received two grants to offer guidance for more effective U.S. foreign policy strategies in Asia and propose structural reforms that propel the region toward growth, innovation, and democratic resilience. The first grant, from the Freeman Spogli Institute for International Studies (FSI), supports SNAPL's policy engagements with stakeholders in Washington, D.C., forthcoming this September. The second grant, from Stanford Global Studies, funds a series of SNAPL-hosted research workshops throughout the 2024-25 academic year.

Both funded initiatives underscore SNAPL's commitment to generating evidence-based policy recommendations and promoting transnational collaboration with academic and policy institutions to advance the future prosperity of Asia and U.S.-Asia relations.

Housed at the Walter H. Shorenstein Asia-Pacific Research Center (APARC), SNAPL is led by Stanford sociologist Gi-Wook Shin, the William J. Perry Professor of Contemporary Korea, a senior fellow at FSI, and the director of APARC and the Korea Program. The lab’s mission is to address emergent social, cultural, economic, and political challenges facing Asia-Pacific countries and guide effective U.S. Asia policies through interdisciplinary, comparative research and collaboration with academic and policy research institutions in Asia and the United States.  

“We are grateful to FSI and Stanford Global Studies for supporting SNAPL's interdisciplinary, policy-relevant research,” says Shin. “The two grants provide a tremendous boost as we work to contribute evidence-based recommendations to advance a more nuanced understanding of Asia's role in global affairs and informed new directions for U.S. Asia policies.”

Policy Considerations for U.S.-China and U.S.-Asia Relations


With a grant from FSI to support policy engagement, SNAPL team members will share research findings from several of the lab’s flagship projects. The SNAPL team — including Shin, Research Fellow Xinru Ma, and Postdoctoral Fellows Gidong Kim and Junki Nakahara — will travel to Washington, D.C. in September 2024 to present these findings at forums and meetings with academic and policy communities. The trip includes a joint symposium with the Center for Strategic and International Studies (CSIS), a presentation at George Washington University’s Elliott School of International Affairs, and meetings with think tanks and Congress members.

Three core projects the team will share guide U.S. policies in Asia, particularly toward China. The first project challenges many pundits’ framing of the U.S.-China competition as a “new Cold War.” In contrast to this narrative, a recent SNAPL study reveals that contemporary U.S.-China relations are markedly different from the U.S.-Soviet Cold War dynamics. “Our analysis of over 41,000 Congressional speeches spanning 36 years suggests that current U.S. discourses on China mirror those on the past economic competition with Japan rather than the ideological or military conflicts with the USSR in the Cold War era,” says Ma. “Applying Cold War analogies to today's geopolitical landscape would thus misguide efforts to navigate current U.S.-China tensions.”

The research findings from a second SNAPL study offer a better understanding of how U.S. alliance relationships and U.S.-China tensions shape public attitudes toward China in the Asia-Pacific region. Furthermore, another study challenges the conventional wisdom that democracy promotion gives the U.S. a competitive edge in its foreign policy over China. “Our research indicates that liberal values do not serve as a key lens through which Asia-Pacific citizens view recent geopolitical developments,” notes Kim. “The United States should therefore pivot from focusing on liberal rhetoric to emphasizing its role in promoting shared benefits with Asia-Pacific citizens in economic, trade, and military security areas.”

These studies are part of SNAPL’s U.S.-Asia Relations research track.

Racism in Global Context


At George Washington University, the SNAPL team will discuss findings from a project the lab explores as part of another research track, Nationalism and Racism. Recognizing that racism is a global problem with diverse roots and manifestations, this research track examines how nationalism and racism intertwine to create forms of exclusion and marginalization in Asia and provides policy recommendations to advance more inclusive societies in the region and beyond.

At this discussion, to be hosted by the Elliott School of International Affairs’ Sigur Center for Asian Studies, the team will present findings from a study that analyzes how 16 Northeast, Southeast, and South Asian nations discuss and justify their positions on race and racial discrimination. “Our study reveals various forms of racism ‘denial’ rooted in nationalist and religious ideologies, hindering efforts to address ongoing inequalities,” says Nakahara. “Addressing these forms of denial is crucial for promoting critical dialogue on race and racism in Asia and dismantling systems of oppression in the region and elsewhere.”

A Platform for Interdisciplinary Research on Contemporary Asia


SNAPL’s second grant, awarded by Stanford Global Studies, will enable the lab to host throughout the 2024-25 academic year a research workshop series focused on projects from the two research tracks above. Involving scholars and students from Stanford and Asia, the six-part series will foster cross-disciplinary dialogue and share policy-relevant findings grounded in the lab’s research.

The four workshop installments in fall and winter quarters 2024 will be dedicated to the projects discussed above. The spring quarter 2025 workshops will focus on two additional projects: one that examines the discursive construction of U.S. rivals and the respective roles of the media, executive, and legislative branches in this process, and the second that investigates elite articulation of “multiculturalism” in four Asia-Pacific nations.

“These workshops will be invaluable to advancing exchange and partnerships with academics and experts from Stanford and across Asia,” says Shin. “They directly promote SNAPL’s mission to serve as a platform that facilitates trans-Pacific, network-based collaboration."

Visit SNAPL's website for information about the workshops’ schedule and discussion topics.

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Advancing Healthcare event by AHPP

Co-sponsored by Peking University's Institute for Global Health and Development and the Asia Health Policy Program

(Friday, September 13, 2024, 9:00am to 10:30am - Beijing time)

In this seminar, distinguished speakers will share their insights on the intersection of cutting-edge technology and healthcare policy. The event will feature short presentations followed by an in-depth discussion, exploring what it takes to bring innovative healthcare solutions from concept to implementation.

Representing different facets of the healthcare ecosystem, the presenters will address key topics such as the application and economic impact of surgical robotics, the delicate balance between pharmaceutical regulation and innovation, technology for population health and chronic disease control, and the development of digital solutions for aging populations.

This seminar offers a unique opportunity for attendees to gain valuable insights into the latest trends in healthcare technology and policy, and to engage in meaningful dialogue about shaping a healthier, more efficient future for all.

Xiaoyanlei 091224

Dr. Lei Xiaoyan is the MOE Cheung-Kong Scholar Professor of Economics, and PKU Boya Distinguished Professor. She is currently the chair of the Academic Committee of the National School of Development, the director of the PKU Center for Healthy Aging and Development Studies, and deputy director of the MOE-PKU Center for Human Capital and National Policy Research, co-editor of the Journal of Economics of Aging, and a research fellow of IZA. Her research spans the areas of labor economics, health economics, and economics of aging. Her research has been published in Review of Economics and Statistics, American Economic Journal: Applied Economics, among others. Since 2020, she has consecutively been included on Elsevier’s List of Highly-cited Scholars in China. She received a Ph.D. in Economics from the University of California, Los Angeles in 2007.

Min Yu 091224

Professor Min Yu graduated from the Department of Clinical Medicine at Zhejiang Medical University with a Bachelor of Medicine degree in 1988 and a Master's degree in Public Health from Beijing Medical University in 1998.

Professor Yu focuses on the prevention and control of chronic diseases and injuries. He has served as the chief editor or co-editor of five monographs and has published over 20 peer-reviewed papers. He has led one project under the National Key R&D Program’s “Precision Medicine Initiative” and three provincial or ministry-level projects. Professor Yu has received the third prize of the Science and Technology Award from the Chinese Preventive Medicine Association, the third prize of the Provincial Science and Technology Advancement Award, and the second prize of Provincial Medical and Health Science and Technology.

Beinilyu 091224

Dr. Beini Lyu's research interests are pharmacoepidemiology, clinical epidemiology of chronic diseases, real-world studies, and health technology assessment. Dr. Lyu’s work has been published in top medical journals such as the Lancet Regional Health-Americas, Diabetes Care, and the American Journal of Kidney Diseases. She served as PI of a research grant from the American Society of Diagnostic and Interventional Nephrology (ASDIN). She has received the Donn D 'Alessio Outstanding Student Award from the Department of Population Health at the University of Wisconsin, the American Heart Association Student Research Fellowship in Cardiovascular Disease, and the Chinese Government Award for Outstanding Self-Financed Student Abroad. Dr. Lyu received her M.D. from Peking University and her Ph.D. in epidemiology from the University of Wisconsin-Madison.

Jianan Yang 091224

Dr. Jianan Yang's primary research fields are health economics and development economics, with specific interests in health policy reform, health behavior and healthcare demand, and pharmaceutical innovation. Her research papers have been published in leading international journals in development economics, such as the Journal of Development Economics. She has also served as an anonymous reviewer for renowned academic journals including the Journal of Public Economics, the Journal of Development Economics, and the Journal of Health Economics, among others. She earned her bachelor’s degrees in Economics and Mathematics from Renmin University of China in 2016, and her Ph.D. in Economics from the University of California, San Diego in 2022. Before joining Peking University, she was a postdoctoral fellow in the Asian Health Policy Program at Stanford University.

Yuhang Pan 091224

Dr. Yuhang Pan's research fields include environmental economics, health economics, and development economics, with a focus on using a causal inference approach to study the impact of environmental pollution, public policy, and climate change on health and social welfare. His works have been published in economics and scientific journals, such as Science, Nature Sustainability, and the Journal of Environmental Economics and Management. Dr. Pan obtained his undergraduate degree from Beijing Normal University in 2015 and his doctoral degree from the Hong Kong University of Science and Technology in 2021. Prior to joining Peking University, he worked as a postdoctoral researcher at the Faculty of Business and Economics at the University of Hong Kong.

Yuhang Pan, Assistant Professor of Economics, Peking University Institute for Global Health and Development

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Xiaoyan Lei, Professor of Economics, Peking University National School of Development and Institute for Global Health and Development
Min Yu, Deputy Director, Zhejiang Provincial Center for Disease Control and Prevention, and Standing Committee Member of Injury Epidemiology Branch of the Chinese Preventive Medical Association
Beini Lyu, Assistant Professor, Peking University Institute for Global Health and Development
Jianan Yang, Assistant Professor, Peking University Institute for Global Health and Development
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The Walter H. Shorenstein Asia-Pacific Research Center (APARC) is pleased to invite applications for a host of fellowships in contemporary Asia studies to begin in Autumn quarter 2025.

The Center offers postdoctoral fellowships that promote multidisciplinary research on Asia-focused health policy, contemporary Japan, and contemporary Asia broadly defined, postdoctoral fellowships and visiting scholar positions with the Stanford Next Asia Policy Lab, and a fellowship for experts on Southeast Asia. Learn more about each opportunity and its eligibility and specific application requirements:

Asia Health Policy Program Postdoctoral Fellowship

Hosted by the Asia Health Policy Program at APARC, the fellowship is awarded to one recent PhD undertaking original research on contemporary health or healthcare policy of high relevance to countries in the Asia-Pacific region, especially developing countries. Appointments are for one year beginning in Autumn quarter 2025. The application deadline is December 1, 2024.

Japan Program Postdoctoral Fellowship

Hosted by the Japan Program at APARC, the fellowship supports research on contemporary Japan in a broad range of disciplines including political science, economics, sociology, law, policy studies, and international relations. Appointments are for one year beginning in Autumn quarter 2025. The application deadline is December 1, 2024.  

Shorenstein Postdoctoral Fellowship on Contemporary Asia

APARC offers two postdoctoral fellowship positions to junior scholars for research and writing on contemporary Asia. The primary research areas focus on political, economic, or social change in the Asia-Pacific region (including Northeast, Southeast, and South Asia), or international relations and international political economy in the region. Appointments are for one year beginning in Autumn quarter 2025. The application deadline is December 1, 2024. 
 

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The Center offers multiple fellowships for Asia researchers to begin in Autumn quarter 2025. These include postdoctoral fellowships on Asia-focused health policy, contemporary Japan, and the Asia-Pacific region, postdoctoral fellowships and visiting scholar positions with the Stanford Next Asia Policy Lab, a visiting scholar position on contemporary Taiwan, and fellowships for experts on Southeast Asia.

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Oriana Skylar Mastro
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This opinion piece originally appeared in The New York Times



Over the past 15 years, China has expanded its once-minimal military presence in the South China Sea into a significant one. Beijing has laid claim to nearly all of the strategic waterway, a vital shipping lifeline for the global economy that is rich in energy and fishery resources. China has used nonmilitary assets such as its Coast Guard, fishing vessels and maritime militia to bully its neighbors, blockade their ships and build Chinese military bases on disputed islands.

America is partly to blame. It has condemned China’s behavior, but, eager to avoid escalation, has consistently refrained from standing up militarily, which has only further emboldened Beijing. A new approach is needed. The United States must take real action to strengthen alliances and confront China before it eventually takes control of this hugely important body of water without firing a shot. 

Like any unchallenged bully, China has become increasingly aggressive. Last month, Chinese Coast Guard personnel attacked a Philippine supply vessel with axes and other crude weapons — Manila says a Filipino sailor and several others were injured — in one of the worst acts of violence between China and its rivals in the South China Sea in years. The incident took place near the Sierra Madre, a rusting World War II-era ship that the Philippines had beached 25 years ago at Second Thomas Shoal to assert its territorial claim. The shoal lies about 120 miles off the Philippine island of Palawan and is well within the nation’s exclusive economic zone.

China also had past territorial confrontations in the South China Sea or other waters on its periphery with Vietnam, the United States, Australia, Japan and Taiwan. In 2012, China took control of the disputed Scarborough Shoal from the Philippines, and run-ins between China and the Philippines have grown in number and intensity in recent years. In late May, President Ferdinand Marcos Jr. of the Philippines warned that any Filipino deaths caused by a “willful act” by a foreign force in the South China Sea would be “very close to what we define as an act of war.”

Concern has grown in Manila, Beijing and Washington that tensions in the South China Sea — perhaps even more than Taiwan — could trigger a conflict with China. These fears are overblown. I study Chinese military strength and strategy, and I’m convinced that if the United States were to take a more assertive stance in the South China Sea, Beijing would be likely to back down to avoid a war it knows it would lose.

China may enjoy military advantages in a potential conflict with Taiwan, which is just off the mainland. But its position is less secure in the South China Sea. Over the past 15 years China has built more than two dozen military outposts on disputed islands. Among the largest — at Mischief Reef, Fiery Cross Reef and Subi Reef — there are air strips, fighter jets, radar systems, and laser and jamming equipment. But so far China lacks sufficient antiaircraft and anti-ship missile systems in the region to deny U.S. forces the ability to operate, which leaves the Chinese bases vulnerable to air and naval bombardment.

And the South China Sea is vast — about half the size of the continental United States. The Sierra Madre is around 800 miles from the Chinese mainland. A conflict there would require the People’s Liberation Army to mount joint air and naval resupply operations and to refuel its fighters across great distances — something it has never done and is not equipped for.

If the Philippines is in the fight, treaty obligations would trigger the participation of the United States, which would have access to nine Philippine air and naval bases, greatly enhancing its already considerable ability to project military power in the region. China does have “carrier-killer” ballistic missiles based on its mainland. But U.S. carriers could still send fighters into parts of the South China Sea from outside the range of those missiles. In conjunction with land-based fighters operating from the Philippines, the United States could gain crucial air superiority over a Chinese surface fleet.

China has spent huge sums on its aircraft carrier program and has two in operation, with two more in development. But those still cannot rival the number or capabilities of nuclear-powered U.S. carriers, which are larger, support more aircraft and need to refuel only about every 20 years. China’s carriers need to be refueled about every six days. And learning how to effectively conduct carrier operations takes time; the Chinese have only just begun.

It’s telling that China has been careful to use Coast Guard and civilian vessels in its encounters with neighbors rather than hard military assets — the latter would signal an escalation that Beijing is not yet willing to embark on.

But there is another very good reason China is unlikely to risk war with the United States: It doesn’t need to. Its brinkmanship and use of nonmilitary assets to intimidate its Asian neighbors has been more than enough to take China from almost no military presence in the South China Sea in the late 2000s to a significant force today.

America should call China’s bluff and press its military advantage. This could include escorting Philippine resupply vessels headed to Second Thomas Shoal or even conducting some supply missions itself or with allies like Australia and Japan. This would send China the powerful message that its intimidation will no longer go unchallenged, while allowing Manila to remain visibly in the lead but part of a more enduring coalition. To save face for China, Washington could present operations like these as exercises or training to minimize pressure on Beijing to respond.

Manila is a strategically vital player in America’s regional competition with China. The United States and the Philippines should strengthen their alliance to allow for more U.S. bases in the Philippines and a stronger U.S. commitment to help defend against Chinese incursions into Philippine waters. Closer relations could also make it easier for the United States to resupply Taiwan from Philippine bases during a conflict with China and open the door for enhanced military cooperation with other South China Sea nations, whose fear of an unrestrained Beijing may be deterring them from taking that step. If China determines that its provocations are likely to draw in the United States, it might begin to moderate its behavior .

Of course, anything is possible — Beijing may respond with a full-on military escalation, a daunting prospect that should not be taken lightly. But that risk is low for a Chinese military whose own doctrine is to avoid any war in which victory is not ensured.

Neither U.S. option — standing up to China or backing down — is attractive. But unless the United States asserts itself, China will continue chipping away with its tactics of bluster and intimidation until its military presence in the South China Sea becomes so dominant that it no longer fears war.

The United States can re-establish a favorable balance of power, but it must act now.

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(Clockwise from top left) Michael McFaul, Oriana Skylar Mastro, Gi-Wook Shin, Kiyoteru Tsutsui
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Members of the Philippine Coast Guard take part in a simulation during a trilateral maritime exercise with Japan and US coast guard on June 6, 2023. The drills that took place in waters facing the South China Sea included maneuverings, maritime law enforcement, and search and rescue at sea. (Photo by Jes Aznar/Getty Images)
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China could seize control of a strategically vital waterway without firing a shot.

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Michael Breger
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The Indo-Pacific, the world’s fastest-growing region in the global economy, faces complex geopolitical and geo-economic risks. Amid Russia’s unrelenting war in Ukraine and its strengthening ties with a bellicose North Korea, China continues to exert its power through economic coercion and diplomatic pressures. Meanwhile, Asia's established and aspiring democracies must rise to the challenge of preventing further democratic decline and revitalizing their institutions. These trends dominated the agenda at the recent Nikkei Forum, The Liberal International Order in the Indo-Pacific.

Cohosted by Shorenstein APARC, the Keio Center for Strategy at the Keio University Global Research Institute, and Nikkei Inc., the forum was held on June 24, 2024, at Keio University and featured Freeman Spogli Institute (FSI) and Keio experts. Its first session, moderated by Akio Fujii, executive chair of the editorial board at Nikkei Inc., included panelists Oriana Skylar Mastro, FSI center fellow at APARC, and Michael McFaul, the director of FSI. They examined the geopolitical effects of the war in Ukraine, deterrence and provocation in Taiwan, and their implications for security in the Indo-Pacific. The second session, moderated by Nikkei commentator Hiroyuki Akita, included Gi-Wook Shin, the director of APARC and director of the Korea Program, and Kiyoteru Tsutsui, the deputy director of APARC and director of the Japan Program. Panelists considered the connectivity of European and Indo-Pacific security, the rise of authoritarianism and global populism, international partnerships, and various ongoing efforts to protect the liberal international order in the Indo-Pacific. The session recordings in English and Japanese are available on the Nikkei Global Events YouTube channel. 

Conflict, Deterrence, and Provocation

Opening the first session, McFaul underscored the broader geopolitical implications of the invasion of Ukraine. Emphasizing the significance of Russian President Vladimir Putin's recent visit to North Korea, he highlighted the intertwined nature of European and Asian security. McFaul argued against the notion that global security should solely focus on China, stressing that Putin's actions demonstrate a critical link between European security concerns and global stability.

McFaul offered a mixed assessment of the war in Ukraine. He praised the international community's response in providing military support and economic aid to Ukraine, stating, “I have been mostly impressed with how the liberal free world, including Japan, came together to provide weapons first and foremost, to provide economic assistance secondarily, and to put in place sanctions [agsint Russia].” Yet he also criticized delays in Western responses, attributing them partly to internal political dynamics, including actions taken during the Trump administration.

What I see, tragically, is the breakdown of the liberal International order.
Michael McFaul
Director of FSI

McFaul expressed concern that Russian defensive positions now hinder prospects for a breakthrough on the Ukrainian side, with future developments tied to the outcome of the next U.S. presidential election. He underscored the importance of democratic nations organizing against autocratic regimes, framing the conflict in Ukraine as a critical battleground for liberal democratic values amidst global power struggles. McFaul described that “what I see, tragically, is the breakdown of the liberal International order. We're going back to an earlier period where there was not one order, but two, and maybe many orders, and one of those divisions is between autocrats and democrats.”

Center Fellow Oriana Skylar Mastro addressed the moderator's query about Ukraine’s implications for East Asia by delving into the complexities of deterrence and provocation in relations with China. She highlighted three main concerns: the blurred distinction between actions that deter China versus those that provoke it, the conflicting priorities of reassuring allies versus deterring adversaries post-Ukraine, and the delicate balance between showcasing military capabilities and demonstrating resolve. Mastro argued that while military build-up might deter China, political gestures, such as enhancing Taiwan's international stature, could provoke tensions.

She emphasized the challenges in aligning U.S. and Japanese strategies, especially regarding Taiwan, where differing interpretations of deterrence and provocation persist. “Attempts to signal resolve can be much more provocative than attempts to demonstrate capabilities [...] It seems that the United States and Japan at least have to be on the same page about what is reassuring versus what deters China, what deters China versus what provokes China, and what is more important, capabilities or resolve,” she explained

Mastro stressed the importance of nuanced policy decisions considering how actions perceived as deterrence in one context might provoke, in another, thus impacting regional stability. “I prefer for the United States to speak softly and carry a big stick, meaning we have a lot of capability but we should stop talking about it so much,” she said. She underscored the U.S. and Japan must coordinate closely on strategic messaging to ensure a cohesive approach to managing China's responses and maintaining regional security.

FSI and APARC scholars meet with Yoshimasa Hayashi FSI and APARC scholars meet with Yoshimasa Hayashi.

During their visit to Tokyo, the Stanford delegation met with Japanese government officials, including Chief Cabinet Secretary Yoshimasa Hayashi.

Michael McFaul gave an interview to the Japan Broadcasting Corporation's (NHK) prime-time news show News 7, which you can view here >

Manifold Pressures on Liberal Democracy

During the second panel, Gi-Wook Shin discussed the contemporary challenges facing liberal democracy, citing instances of foreign influence from authoritarian states like Russia and China. He began with a personal anecdote from Mongolia, where a friend running for parliament reported intimidation by authorities allegedly supported by Russia. Shin drew parallels to previous instances of interference, such as Russia's involvement in the 2016 U.S. election and China's actions in Taiwan and Korea.

In contrast to the American and British leadership against fascism and communism in the 1930s and 1940s, Shin described the current crisis in global leadership to safeguard liberal values. He questioned whether any country could now step up to combat rising authoritarianism, citing Modi’s India and alliances forming between leaders like Putin, Kim Jong-Un, and Xi Jinping. “I don't think I can say with confidence that the U.S. can defend liberal democracy, I don't see any leader in Europe either, and I don't see anyone in Asia,” he lamented.

He called for strategies to restore and strengthen global leadership in promoting and defending liberal democracy against mounting authoritarian challenges from China, Russia, and others.

Japanese democracy is functioning quite well. Apart from that, Japanese Society is peaceful, safe, and stable. Although the economic growth rate is low, people's discontent is not gushing out
Kiyoteru Tsutsui
Deputy Director of APARC

In his remarks, Kiyoteru Tsutsui addressed these global challenges to democracy and emphasized Japan's role in safeguarding it. Tsutsui noted Japan's relatively stable democratic environment compared to nations experiencing greater political divisions. Despite recent economic fluctuations in the country,, “Japanese democracy is functioning quite well,” he argued. “Apart from that, Japanese society is peaceful, safe, and stable. Although the economic growth rate is low, people's discontent is not gushing out and they can live quite a good life.”

Tsutsui emphasized Japan's economic and diplomatic contributions to promoting democracy, citing its trusted role in assisting Asian countries through the Japan International Cooperation Agency (JAICA). He suggested Japan could assert its influence not only through traditional democracy promotion but also by establishing standards in areas like infrastructure and public health. “If we look at the global rankings, Japan has quite a big influence.” He underscored the importance of Japan's discreet but impactful diplomacy in upholding democratic values globally, including its involvement in initiatives like the Free and Open Indo-Pacific Strategy, The Quad, and CPTPP. Through practical actions and international cooperation, he said, Japan  demonstrates its commitment to democratic values and counters global trends of democratic decline. Throughout the forum, the panelists agreed that the Indo-Pacific remains at the center of the global struggle between democracy and autocracy. They emphasized the need for collaborative action to bolster democratic institutions worldwide and urged nations to unite quickly to prevent further escalation of tensions in the region and beyond.

Nikkei newspaper report on the Nikkei Forum – July 3, 2024
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(Clockwise from top left) Michael McFaul, Oriana Skylar Mastro, Gi-Wook Shin, Kiyoteru Tsutsui
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At the Nikkei Forum, Freeman Spogli Institute scholars Oriana Skylar Mastro, Michael McFaul, Gi-Wook Shin, and Kiyoteru Tsutsui considered the impacts of the war in Ukraine, strategies of deterrence in Taiwan, and the growing tension between liberal democracy and authoritarian populism.

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Noa Ronkin
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China's ascent in the economic, technological, and military spheres and its assertive foreign policy have disrupted geopolitical paradigms, prompting intensified discussions of great power competition and rivalry. But how did China achieve great power status and build it from a weaker resource position in a U.S.-dominated international system?

Stanford political scientist Oriana Skylar Mastro, an expert on Chinese military and security policy, sets out to answer this question in her new book, “Upstart” (Oxford University Press), which offers a novel framework for understanding how China chose to compete on the international stage. A center fellow at the Freeman Spogli Institute for International Studies and faculty at the Shorenstein Asia-Pacific Research Center (APARC), Mastro draws on the political science and business literature to explain China’s thinking that allowed it to enter the great power club.

Mastro joined APARC Publications Manager George Krompacky to discuss her new book. Listen to the conversation on our SoundCloud or YouTube channels. A transcript is also available to download.

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The Startup Approach

In debating about China’s rise, one might fall into the trap of assuming that China would pursue its ambitions like the United States has. Mastro, however, argues that China does not act the same way as the United States or other would-be superpowers and does not have to compete everywhere and in the same manner to yield influence or dictate outcomes.

Acknowledging the highly politicized nature of China’s rise and U.S. competition with China, Mastro emphasizes a pragmatic approach in her book. “For the United States to compete effectively, we have to understand first what the situation is,” she says, ascribing her pragmatic outlook, at least partially, to her military career. Mastro continues to serve in the U.S. Air Force Reserve, currently as the deputy director of reserve global China strategy at the Pentagon.

Mastro shows that China’s buildup of power over the past three decades stems from pursuing a “startup approach,” that is, a careful mix of three strategies: emulation (mirroring U.S. activities in similar areas), exploitation (adopting U.S. strategies, but in different areas of competition, where the United States isn't strongly present), and entrepreneurship (applying innovative approaches to new and existing areas of competition). Throughout her book, she provides 22 case studies in the economic, military, and political realms to illuminate when China has used each of the three components of the startup strategy and explain why it has chosen a certain pathway at a given time.
 

It’s indisputable that what China has accomplished over the past 30 years is impressive.

Emulation, for example, is manifested in China's approach to mediation diplomacy, as it attempts to present itself as an international mediator to gain power and influence; in its pursuit of humanitarian aid, disaster relief, and peacekeeping operations; and its attempts to internationalize the renminbi.

Instances of exploitation include China’s use of arms sales to countries that can't buy them from the United States due to factors like treaty obligations or embargoes; its approach to free trade and industrial policy; and its ability to keep most U.S. forces out of Asia and disrupt those operating there (known as its anti-access/ area denial capability.

Examples of China’s entrepreneurial approach include its reliance on strategic partnerships instead of alliances; its nuclear strategy and protection of overseas interests (unlike the United States, China has no overseas bases and has not relied on a large nuclear arsenal); and its Belt and Road Initiative.  

By no means is China always successful. Mastro lists various examples indicating, she argues, that China chose the wrong strategy in its pursuit of power buildup, such as its attempts to emulate U.S. soft power or aircraft carrier capabilities. ”But I don't want us to be blind to the realities that a lot of what China does has been effective,” says Mastro. “It’s indisputable that what China has accomplished over the past 30 years is impressive.”

Had there been a more nuanced understanding of China's strategic intentions, the United States might have reinforced certain norms and established new rules to limit China's influence more effectively.

Emulation and Exploitation in Foreign Policy

One salient example of the United States’ misunderstanding of China's strategic approach pertains to China’s participation in international organizations. It is also a lesson in the importance of reevaluating and reinforcing the frameworks that govern international institutions.

International institutions, Mastro explains, have been a key mechanism for the United States to build and exercise power in a flexible, innovative manner. Confident in these institutions' ability to regulate state power in alignment with American interests, many in the United States believed that integrating China into the global order would push Beijing towards political and economic liberalization. This belief underpinned the U.S. support for granting China a most-favored-nation status in the 1990s and its entry into the World Trade Organization.

By the early 21st century, China had joined 50 international governmental organizations and more than a thousand international non-governmental organizations. Within these bodies, China sought to assume a leadership role comparable to that of the United States and its allies, aiming to steer agendas and influence outcomes. Not only did China turn out to be adept at working within the rules to shift institutional directions but also at exploiting loopholes, as, for example, in trade organizations, where its compliance with the established norms has been selective. The U.S. expectations about China’s economic liberalization and democratic reform, however, proved to be distorted.

“The underlying issue was the assumption that China would adopt a worldview similar to the U.S. upon deeper integration,” Mastro says. “Had there been a more nuanced understanding of China's strategic intentions, the U.S. might have reinforced certain norms and established new rules to limit China's influence more effectively.”

While we might think there are all kinds of constraints to [China’s calculus on Taiwan], those are not actually in place.

Taiwan and a Changing Military Balance of Power

Just as the United States was mistaken in believing that international institutions would limit China's actions in foreign policy, it might also be wrong in assuming that China's integration into the global economy has changed its stance on the use of force or that China will consider the cost of attacking Taiwan too high.

According to Mastro, Taiwan is another case where Beijing measures costs and benefits differently from Washinton. “While we might think there are constraints on Chinese [calculus on Taiwan], those constraints are often not actually in place.”

For China, Mastro explains, Taiwan is of utmost importance and deeply connected to the legitimacy of the Chinese Communist Party. She stresses that her research indicates that, as part of China's use of economic power, there is good reason to suspect that international isolation and condemnation in response to a Chinese assault on Taiwan would be relatively mild. ”Most strategic partnerships include clauses where countries agree not to let political issues like Taiwan affect their economic relationships,” Mastro says. “This, combined with the changing military balance of power, is something I hope readers understand from my book.

Lessons for U.S. Strategy

In the last chapter of her book, Mastro discusses the implications of China’s upstart strategy for U.S. policy and offers guidance on how Wahington can address China’s rise. “The United States needs to target its approaches to build and maintain a competitive edge with its own version of an upstart strategy,” Mastro writes. Specifically, the United States should avoid emulating all of China's successes, promote emulation where it maintains competitive advantages, close the gaps China exploits to build power, and embrace its unique entrepreneurial approaches.

“The overall goal should be to move competition into areas where the United States has an advantage and reduce the impact of Chinese strategies where China enjoys advantages,” Mastro notes.

But how realistic is it for the United States to play the long game in this manner, given its four-year election cycle and current politically polarized environment?

Mastro recognizes that not only does the U.S. domestic political system make it difficult for policies to continue from one administration to another, but it also increases the cost of entrepreneurial thinking for any administration interested in implementing a new approach during its four-year term. Entrepreneurial actions require a degree of experimentation, but our politicians are averse to taking risks with actions and policies that might require course adjustment.  

Ultimately, Mastro concludes, it is a question of leadership. “I think the rise of China and the challenge of China is of such importance and urgency that you need leaders to put their political aspirations aside and think in a more calculated, strategic way. You need that kind of leadership and courage in our system for us to be able to compete with China.”

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A new book by Stanford political scientist Oriana Skylar Mastro offers a novel framework, the “upstart approach," to explain China's 30-year journey to great power status through strategic emulation, exploitation, and entrepreneurship.

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Gerhard Hoffstaedter

Multiple crises complicate the resettlement of refugees in Malaysia—from the irregular migration trajectories of Chin and Rohingya refugees to their efforts to settle in a new country. Although Malaysia harbors one of the largest urban refugee populations in Southeast Asia, it does not grant most refugees any status and is not a party to the UN refugee convention. Malaysian state authorities surveil, police, detain, and extort refugees on a regular basis, mistreatment exacerbated by recent COVID-19 restrictions. And yet there are spaces outside of this control in which “sociabilities of emplacement” (Çağlar and Glick-Schiller 2018) are possible, where refugees are able to create places of protection, earn a living, and, in rare cases, make meaningful homes for themselves.

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Gerhard Hoffstaedter 042424

Gerhard Hoffstaedter is an Associate Professor in anthropology at the University of Queensland, Australia. His research is focused on refugees in Southeast Asia, on immigration policies and on religion and the state. His many publications include Modern Muslim Identities: Negotiating Religion and Ethnicity in Malaysia (2011) and co-edited volumes on Urban Refugees: Challenges in Protection, Services and Policy (2015) and Why Human Security Matters: Rethinking Australian Foreign Policy (2012). He also directs “The Anthropology of Current World Issues,” a Massive Open Online Course that has taught thousands of students how to think more anthropologically.

Gerhard Hoffstaedter, 2023-2024 Lee Kong Chian NUS-Stanford Fellow on Contemporary Southeast Asia
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