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Europe dominated the 19th century. The 20th century saw the rise of the United States. Will the 21st century be "the Chinese Century"? Using a series of Harvard Business School Cases, this lecture will explore production, consumption, and education for China's new middle class, and think about China's future, in the light of its past.

William C. Kirby is T. M. Chang Professor of China Studies at Harvard University and Spangler Family Professor of Business Administration at the Harvard Business School. He is a Harvard University Distinguished Service Professor. He serves as Director of the Fairbank Center for Chinese Studies and Chairman of the Harvard China Fund.

A historian of modern China, Professor Kirby's work examines China's business, economic, and political development in an international context. He has written on the evolution of modern Chinese business (state-owned and private); Chinese corporate law and company structure; the history of freedom in China; the international socialist economy of the 1950s; relations across the Taiwan Strait; and China's relations with Europe and America. His current projects include case studies of contemporary Chinese businesses and a comparative study of higher education in China, Europe, and the United States.

This talk is co-sponsored with the Center for East Asian Studies (CEAS).

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William C. Kirby T. M. Chang Professor of China Studies at Harvard University and Spangler Family Professor of Business Administration Speaker Harvard Business School
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Lyushun Shen earned his doctorate in International Relations from the University of Pennsylvania. He started his career at the School of Law, University of Maryland before deciding to become a professional diplomat.  He has enjoyed a distinguished career serving Taiwan in its overseas missions in America and Europe, including in Washington D.C., Kansas City, Geneva and Brussels.  Prior to his current appointment he was Taiwan’s representative to the European Union. His publications include:  “The Republic of China’s Perspective on the US Omnibus Trade and Competitiveness Act of 1988” (The Chinese Yearbook of International Law and Affairs, 1989), The Issue of US Arms Sales and Peking’s Policy toward Taiwan (Taipei, 1986), “Is Peking’s Claim over Taiwan Internationally Recognized?” Monograph Series of the Asia and World Forum (Taipei, 1984), “The Washington-Peking Controversy over US Arms Sales to Taiwan: Diplomacy of Ambiguity and Escalation” (The Chinese Yearbook of International Law and Affairs, 1982), and “The Taiwan Issue in Peking’s Foreign Policy during the 1970’s, A Systematic Review” (The Chinese Yearbook of International Law and Affairs, 1981).

In this special event, Vice Foreign Minister Shen will reflect on the century-long relationship between the Republic of China and the United States, and address the future prospects and challenges of this relationship. 

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Lyushun Shen Vice Foreign Minister Speaker Ministry of Foreign Affairs, Republic of China (Taiwan)
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Tenancy markets provide an opportunity to trade land between labor-scarce farmers, that is those who engage in off-farm employment, and land-scarce farmers, that is those who want to expand agricultural production. For emerging middle-income countries where rural to urban migration is active, facilitating a well-functioning tenancy markets is important to increase farmer's income and improve agricultural productivity. Although the existing literature argues that high transaction costs are the major source of market failure, the nature of transaction costs is seldom explored. We hypothesize that the search and negotiation costs and the expected loss of land, due to weak property rights, are the major components of the transaction costs in tenancy markets and that they lead to smaller numbers of rental transactions. We also find empirical evidence in support of these hypotheses using farm household data from China.

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Scott Rozelle
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North Korea conducted its first nuclear weapons test in October 2006, prompting the UN Security Council to establish military and economic sanctions in an effort to block further development of the country's nuclear program. After North Korea conducted another test in May 2009—a move that U.S. President Barack Obama described as "directly and recklessly challenging the international community"—the UN Secretary General, at the request of the Security Council, convened a Panel of Experts to advise and assist the UN committee that enforces the sanctions (the "1718 Committee," after the UN Security Council Resolution that brought it into being).

John Everard, 2010-2011 Pantech Fellow with the Stanford Korean Studies Program at the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) and former UK Ambassador to North Korea, left Stanford at the end of March to take up a position with the panel.

The seven-member panel comprises independent experts from the Security Council's five permanent member countries—China, France, the Russian Federation, the United Kingdom, and the United States—and from South Korea and Japan. Some experts come from academic institutions while others have been lent to the panel by national governments. As part of its efforts to advise the 1718 Committee, the panel often travels to inspect banned goods—such as materials that could be used for nuclear purposes—in intercepted cargo shipping to or from North Korea. 

During his diplomatic service in North Korea from 2006 to 2008, Everard closely observed and took photographs of the details of everyday life, discovering that the mindset of ordinary people frequently does not match official government ideology. "There is an openness toward warm relations with Americans if political relations improve," he says. Everard is currently working on completing a book describing his observations of the everyday life of non-elite North Koreans, as well as his experience as a foreigner living in North Korea. It also addresses how North Korea as a country has evolved over the past sixty years and provides suggestions for how better to deal with its government.

Although Everard looks forward to his new position with the Panel of Experts, he will not soon forget his time at Shorenstein APARC. "It has been a great experience," he emphasizes. "It has been a real delight to be surrounded not just by this beautiful architecture and the wonderful facilities that Stanford has, but also by the very friendly, very intelligent people here."

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John Everard, 2010-2011 Pantech Fellow, speaking at the third annual Koret Conference, February 24, 2011.
Rod Searcey
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Over the past three decades, China's government, economy, and society have been undergoing a transformation, the momentum of which has intensified in recent years. Stanford sociologist Xueguang Zhou has been conducting a detailed ethnographic study in a rural township a few hours' drive from Beijing in order to understand these changes, especially in terms of China's political institutions. He is also beginning research about the behavior of urban government organizations and about the trajectory of personnel mobility in the Chinese bureaucracy.

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Xueguang Zhou, FSI senior fellow and Kwoh-Ting Li Professor in Economic Development
Zhou (PhD '91), a senior fellow with the Freeman Spogli Institute for International Studies and the Kwoh-Ting Li Professor in Economic Development with the Department of Sociology, chose to conduct his ethnographic research project in a rural township because it afforded him a chance to stay in one place over a long period of time and to get closer to the everyday life of local residents. "It is easier to conduct this kind of research in rural areas because people are always there and once they get to know you, you can gain access to and make sense of their experiences, feelings and views, and their coping strategies in response to large-scale social changes," he notes.

Zhou's rural governance study branched out into three interrelated directions. He has been studying agricultural markets, including: how they have been taking shape and evolving over time, how harvests are conducted, and where local elites and farmers interact with large outside companies. China's rural election system, which Zhou suggests has become more institutionalized in the past six to eight years, has been another area of focus. He has examined how the system was first established, and how it has evolved into its current shape. Finally, he has followed patterns of government behavior within the context of the significant changes now underway in China.
"From a research point of view, this is really a critical moment in the Chinese economic transformation.

-Xueguang Zhou

FSI Senior Fellow and Kwoh-Ting Li Professor in Economic Development

Gradually shifting his focus to the study of China's urban political institutions, Zhou has been working with a doctoral candidate from Peking University to study the behavior of urban government bureaus for the past three years, and they are now working on articles highlighting the major findings from this research. In addition, Zhou is in the process of selecting urban sites in which to conduct a more prolonged and detailed study similar to his rural township project. He is also working with a Stanford master's student to analyze twenty years of government personnel data, tracing the movement of specific individuals across offices and bureaus as they have been promoted through the bureaucratic system. "It is all a public record," says Zhou, "but once you piece these trajectories together, they shed light on the inner working of, and dynamics in, the Chinese bureaucracy."

China's overall transformation has greatly accelerated in the past decade, and even as urban life is changing, life in rural areas around China's coastal megalopolises is perhaps changing even more quickly. Zhou suggests that within the next five to ten years the contribution of China's shrinking rural areas towards the country's GDP will become quite insignificant. "The speed is really just astonishing," he emphasizes. As cities expand, local governments purchase up land from rural residents for commercial development projects like shopping centers and apartment complexes. Real estate is a huge source of income for city governments and so there has been an aggressive push toward urbanization. As a result, says Zhou: "Millions of rural residents lost their land and became urban overnight without any relevant work skills." Although they are compensated to various degrees for their land, the bigger question is how this will affect the new city dwellers and their families in the future as they must develop new skills and adapt to the social and environmental conditions of urban life.

"From a research point of view," states Zhou, "This is really a critical moment in the Chinese economic transformation: the way that they deal with the process of urbanization will have tremendous consequences for the years to come because it is creating so much tension and social conflict." Even away from coastal areas, government-driven urbanization is taking place everywhere in China—even in provinces with vast expanses of remote land like Xinjiang. "This is exactly why you want to study government," maintains Zhou. "Because they play a key role in this process." Understanding China's government institutional structures, its decision-making processes, and the way that resources are mobilized will lead the way to better understanding about the future impact of these decisions that are now so rapidly changing both the rural and urban landscape.

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A grape harvest in rural China
Courtesy Xueguang Zhou
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From how failure drives innovation to the role of government in supporting entrepreneurship, two expert professors at Stanford led a training session for executives from Chinese state-owned enterprises (SOE) as part of the 2011 Cisco China 21st Century Enterprise Leader Program (ELP) hosted by Stanford Program on Regions of Innovation and Entrepreneurship (SPRIE) on March 22, 2011.

Professor William F. Miller, Co-Director of SPRIE, kicked off the session with a stimulating presentation on Silicon Valley's habitat for innovation. He pointed out that turning technology into business was the essence of Silicon Valley, and a favorable business, social and political environment in the region had facilitated the process. Despite the emergence of other venture capital locations, Silicon Valley scooped up almost 40% of venture deals and dollars across the U.S. in the last quarter of 2010, according to the MoneyTree Report.

The "restless pioneer spirit" of Stanford had always played a crucial role in the effective interaction between research institutes and industry, Miller argued.

Following Miller's discussion of features of Silicon Valley's entrepreneurial habitat, William Barnett, Thomas M. Siebel Professor of Business Leadership, Strategy, and Organizations at the Stanford Graduate School of Business, shared his thoughts on how to discover successful business models.

"Having great technologies is not enough," said Barnett. "Entrepreneurs are like scientists. Successful business models are learned from failures." Barnett encouraged the leaders present to create a working environment within which failure would be tolerated. He further urged them to accelerate the learning process by asking what might go wrong.

The purpose of the SPRIE session, which is part of a 12-day US-based program organized by Cisco Systems and China's State-owned Assets Supervision and Administration Commission (SASAC), is to help the SOE executives understand how to foster innovation and to drive operational excellence. The delegation is composed of SASAC officials, Peking University professors and leaders from 17 SOEs in China, including Southern Power Grid, Three Gorges Corporation, China Telecom, China Unicom, China Mobile, China FAW Group, Harbin Electric Corp., Anshan Iron and Steel Group, Baosteel Group, China Ocean Shipping Company, China Eastern Airlines, China Oil and Foodstuffs Corporation, State Development and Investment Corporation, China Merchants, China Railway Group and China Railway Construction.

 

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Professor William Barnett at 2011 Cisco China 21C Enterprise Leader Program training session hosted by SPRIE on March 22, 2011.
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"The bigger vision of the AP Scholars Program is that the connections live on after the two years, and that they are fruitful because of the friendships and better understanding established during the discussions." 

-Thomas Fingar
Oksenberg/Rohlen Distinguished Fellow at FSI

Former President Gerhard Casper launched the Asia-Pacific Scholars Program (AP Scholars Program) in 1997 to strengthen and expand Stanford University's ties with Asia. The program was loosely modeled on Oxford University's Rhodes Scholarship. Led by renowned China scholar Michel Oksenberg of the Asia/Pacific Research Center (the predecessor organization of the Walter H. Shorenstein Asia-Pacific Research Center), the first program brought together a highly diverse class of nineteen graduate students from the United Kingdom, the United States, and numerous countries in Asia. The AP Scholars Program thrived under Oksenberg's direction, but fell dormant for nearly a decade following his death in 2001.

Thomas FingarThomas Fingar, the Oksenberg/Rohlen Distinguished Fellow at the Freeman Spogli Institute for International Studies and a former chairman of the National Intelligence Council, re-launched the AP Scholars Program in September 2010. "I am delighted to have been asked to revive it," states Fingar. In keeping with its original design, the two-year program is open to Stanford doctoral students from Asia-Pacific countries and to those studying issues related to the region. The twelve current participants come from China, Japan, Korea, Thailand, and the United States, and are studying disciplines ranging from art history to engineering. In the future, incoming students will be invited to participate in the program, creating a dynamic cohort of new and continuing students.

The AP Scholars Program serves as a forum for discussing significant and often-sensitive issues relating to the Asia-Pacific region, and for building a strong academic and professional network linking Asia and Stanford. In its current format, it is designed to broaden students' understanding of how U.S. government officials think about and make policy decisions on Asia, and to provide insight into how American scholars study Asia in relation to global issues. Additionally, it offers the significant opportunity for students from different countries and academic disciplines to dialogue not only with one another, but also with leading academics and former senior-level U.S. government officials at Stanford. 

"This is really an incredible enrichment opportunity," emphasizes Fingar. Students meet once a month during the academic year for a two-hour dinner seminar featuring a presentation and a question-and-answer session with a guest speaker. These informal sessions offer a rare and a highly insightful window into the experience of individuals who have been involved in recent decades with key policy decisions about Asia and with major research shaping understanding of Asia in the United States. After each presentation, the speaker and students engage in candid dialogue.

During the 2010-2011 academic year, students will hear from academic experts on climate change, nuclear proliferation, and food and energy security, and from former senior U.S. government officials who served in the Department of Defense, the Department of State, the National Intelligence Council, and Congress. Fingar leads a wrap-up discussion after each presentation, during which the students provide their own perspectives on the issues presented. In this environment, difficult topics are discussed in an open, and thoughtful manner. There are no readings or other outside preparation required to participate in the AP Scholars Program.

Waraporn Tongprasit, a student with the Department of Management Science and Engineering who is originally from Thailand, appreciates the different issues discussed during the presentation sessions, and the opportunity for networking that the program offers. "Through the AP Scholars Program, I am learning about political, social, and economic issues in my home country and region, and about the perspective of U.S. scholars and the U.S. government on these issues," she says. "I also have an opportunity to establish connections with other students from the Asia-Pacific region who are experts in many different areas."

Yezhou Shi, a Materials Science and Engineering student from China, values the unique chance to speak so candidly with prominent scholars and former government officials, and to hear about their experience with major global issues and events. "These are stories that I could probably never know without attending the AP Scholar Program seminars—these are really inside stories," he says. Shi also enjoys the opportunity to speak with students from different countries on issues that he would not normally feel comfortable discussing. "In daily conversation, I would not bring up some of these issues unless it was with a really close friend," he stresses. "[In the program,] of course, I pay attention to what I say, but I think that everyone understands that we are there to discuss important issues."

Fingar is optimistic as he looks to the future of the program, and its continuing impact after the current class of students completes it in 2012. "The bigger vision of the AP Scholars Program is that the connections live on after the two years," he says, "and that they are fruitful because of the friendships and better understanding established during the discussions."

Pacific Vision: The inaugural AP Scholars class
 

The film Pacific Vision was released in 1998 to commemorate the AP Scholars Program's inaugural year. A clip from the film, featuring interviews with Casper and Oksenberg, is available here courtesy the Stanford University Archives. 
 

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President Barack Obama, First Lady Michelle Obama, and President Hu Jintao of China greet the U.S. delegation, including Secretary of State Hillary Rodham Clinton, on the South Lawn of the White House, Jan. 19, 2011.
Official White House photo by Pete Souza
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During the State of the Chinese Economy conference held recently at the University of Southern California (USC), Scott Rozelle, the Helen F. Farnsworth Senior Fellow at the Freeman Spogli Institute for International Studies, discussed current and future challenges to China's human capital in terms of education, health, and nutrition. A full video recording of Rozelle’s presentation is available on the USC website.
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Rex Pe
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In September, Crystal Chang and Jeremy M. Menchik will join the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) as its Shorenstein Fellows for the 2011–2012 academic year. 



Crystal ChangCrystal Chang, a PhD candidate with the Department of Political Science at the University of California, Berkeley, is currently completing her dissertation on China's growing independent automotive industry. Her research examines Chinese automakers alongside historical case studies from Japan and Korea. During her time at Shorenstein APARC, she will expand her dissertation to include a comparative study of India's contemporary automotive industry, which, like China's, has experienced domestic and international success. She will also continue research that she is currently conducting about China's private energy sector, with a focus on the solar power industry. Chang holds an MPIA degree in international management from the University of California, San Diego, and a BA in international relations from Stanford University.



Jeremy M. MenchikJeremy Menchik, a PhD candidate with the Department of Political Science at the University of Wisconsin-Madison (UW-Madison), is finishing his dissertation, which poses the question: what is the basis for religious tolerance in Indonesia, and why does it sometimes break down? He addresses this question through a study of Indonesian civil society and of three of the country's largest and oldest Islamic organizations: Nahdlatul Ulama, Muhammadiyah, and Persatuan Islam. Menchik has conducted extensive field research in Indonesia during the course of his graduate studies. At Shorenstein APARC, he will prepare his dissertation for publication and develop related projects on Islamic law, political tolerance, and political symbolism in Indonesian elections. Menchik holds an MA in political science from UW-Madison and a BA, also in political science, from the University of Michigan.

 

Established in 2002 through the generosity of Walter H. Shorenstein, the Shorenstein Fellowship in Contemporary Asia is an exciting opportunity for junior scholars to spend a year at Shorenstein APARC, engaging with other scholars and experiencing the world-class resources—ranging from libraries to events—that Stanford University has to offer. Shorenstein APARC looks forward to welcoming Chang and Menchik to the center in the coming academic year.

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