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China has benefited from the liberal international order led by the United States. However, China is uncomfortable with aspects of the current system and will seek to change them as part of a broader effort to reform global institutions to reflect its perception of 21st-century realities. One set of shaping factors—China’s assessment of the current world order—identifies much that Chinese leaders would be reluctant to change because they want to continue to reap benefits without assuming greater burdens. A second set of factors includes traditional Chinese or Confucian concepts of world order. A third set of factors comprises the attitudes and actions of other countries. China’s rise has been achieved by accepting greater interdependence, and its ability to exert influence depends on the responses of other nations.

Policy Implications

  • China appears to want to maintain most elements of the current global order, including U.S. leadership. But it also wants the United States to allow other nations, specifically China, to have a greater voice in decisions affecting the international system.
  • China is more interested in improving and establishing rules and institutions needed to meet 21st-century challenges than in wholesale replacement of existing mechanisms. This makes China a willing as well as necessary partner in the remaking of institutions to meet shared international challenges.
  • Despite incurring Beijing’s disapproval, the United States must continue to hedge against uncertainties by maintaining the collective security arrangements and institutions that have contributed to global stability and the security of individual nations.

Appears in Strategic Asia 2012–13: China's Military Challenge, Ashley J. Tellis and Travis Tanner, eds.

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National Bureau of Asian Research
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Thomas Fingar
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978-0-9818904-3-2

Shorenstein APARC
Encina Hall, Room E301
Stanford, CA 94305

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2012-2013 Visiting Scholar
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Jaekwon Son is a 2012-2013 visiting scholar with the Korean Studies Program at the Walter H. Shorenstein Asia-Pacific Research Center. Son, a reporter at the Maeil Business Newspaper in Korea, will conduct research on the impact of new media journalism, such as social networking through smart devices. 

Son has co-authored books including The Appstore Economics (2010), Mobile Changes the World (2010), and The Naver Republic (2007). He has been awarded Jounalist of the Month from the Korea Jounalist Association (2012) and Jounalist of the Year from the Hanvit Culture Foundation (2008).

Son holds a BA in classical Chinese from Korea University.

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May 2013 marks the thirtieth anniversary of the Walter H. Shorenstein Asia-Pacific Research Center. Over the three decades of the Center’s existence, immense change has taken place in the Asia-Pacific.

The early 1980s were a time for tremendous, transformative ripples of social, political, and economic change in many Asian countries; many of those changes set in motion trends, institutions, and events that are prominent aspects of the Asian landscape today.

In Northeast Asia, China embraced market reforms and opened its doors to foreign investment and trade, setting the stage for its role as a contemporary global leader. Japan experienced the peak of its post-war boom, consolidating its role as a pioneer in technology and manufacturing. South Korea underwent a dramatic transformation that, paired with its rapid economic growth, created a regional powerhouse. Southeast Asia emerged from the shadow of war to become a region of economic tigers and emerging powers.

At Stanford, the Northeast Asia-United States Forum on International Policy and the Center for International Security and Arms Control (CISAC) were established in May 1983 as independent, but complementary, entities. The Northeast Asia-United States Forum later grew into the Asia/Pacific Research Center and, in 2005, was endowed as the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC). The two centers still closely collaborate on research and events. In the ensuing three decades, Shorenstein APARC expanded its reach beyond core expertise on Northeast Asia to the fast-developing region of Southeast Asia and to South Asia, which has emerged as a new center of power in the Asia-Pacific. The Center has focused increasingly on the crosscurrents of growing economic, cultural, and institutional integration in the region alongside a troubling rise of tensions driven by intensifying nationalism.

Today, Shorenstein APARC boasts five vibrant programs focusing on contemporary Asia and engaged in policy-oriented research, training, and publishing: the Asia Health Policy Program, Japan Studies Program, Korean Studies Program, Southeast Asia Forum, and the Stanford China Program. It also takes great pride in its unique Corporate Affiliates Program, whose alumni roster of over 300 Asian business, government, and media professionals continues to expand. Rounding out Shorenstein APARC’s Asia expertise, its South Asia Initiative has produced many important publications and events for over a decade.

On May 2, 2013, Shorenstein APARC will celebrate its anniversary with a special public symposium exploring Asia’s transformation over the past three decades, developments in U.S.-Asia relations, and the trajectory of Shorenstein APARC’s own history. You are invited to join us in marking this historic occasion.

Panel 1: Asia's Rise

Panel 2: Shorenstein APARC's History

 Panel 3: Developments in U.S.-Asia Relations

Bechtel Conference Center

Symposiums
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Education has provided the critical foundation for Asia’s rapid economic growth. However, in an increasingly globalized and digital world, higher education faces an array of new challenges. While the current strengths and weaknesses of educational systems across Asia differ considerably, they share many of the same fundamental challenges and dilemmas.

The fourth annual Stanford Kyoto Trans-Asian Dialogue examined challenges and opportunities in reforming higher education in Asia. At its core, the challenge facing every country is how to cultivate relatively immobile assets—national populations—to capture increasingly mobile jobs with transforming skill requirements. This raises fundamental questions about skills needed for fast-paced change, domestic inequality, the role of government, and choices of resource allocations.

Scholars and top-level administrators from Stanford University and universities across Asia, as well as policymakers, journalists, and business professionals, met in Kyoto on September 6 and 7, 2012, to discuss questions that address vital themes related to Asia’s higher education systems. These included:

  • Can higher education meet the challenges of economic transformations?
    As skill requirements change with the increasing use of IT tools that enable manufacturing and service tasks to be broken apart and moved around, how can higher education systems cope? How can education systems address the increasing need for global coordination across languages and cultures? How can countries deal with demographic challenges, with developed countries facing overcapacity and developing countries with younger populations facing an undercapacity of educational resources?
  • How are higher education systems globalizing?
    What are the strategies for the globalization of higher education itself? How are universities positioning themselves to attract top talent from around the world, and what are their relative successes in achieving this? What are the considerations when building university campuses abroad? Conversely, what are the issues surrounding allowing foreign universities to build within one’s own country?
  • How can higher education play a greater role in innovation?
    What is the interplay between private and public institutions and research funding across countries, and what are the opportunities and constraints facing each? What is the role of national champion research initiatives? For developed East Asian countries, a focus on producing engineers raised the economic base, but many are discovering that they are still not at the leading edge of innovation. What are ways to address this dilemma? For developing countries, the challenge is how to improve basic education from the level of training basic factory workers to creating knowledge workers. How might this be accomplished? Is there room for a liberal arts college model?
  • What are the challenges and opportunities in reforming higher education?
    What are effective ways of overcoming organizational inertia, policy impediments, and political processes that hinder reform? What are the debates and issues surrounding ownership, governance, and financing of higher education?

The Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) established the Stanford Kyoto Trans-Asian Dialogue in 2009 to facilitate conversation about current Asia-Pacific issues with far-reaching global implications. Scholars from Stanford University and various Asian countries start each session of the two-day event with stimulating, brief presentations, which are followed by engaging, off-the-record discussion. Each Dialogue closes with a public symposium and reception, and a final report is published on the Shorenstein APARC website.

Previous Dialogues have brought together a diverse range of experts and opinion leaders from Japan, South Korea, China, Vietnam, Thailand, Indonesia, Singapore, India, Australia, and the United States. Participants have explored issues such as the global environmental and economic impacts of energy usage in Asia and the United States; the question of building an East Asian regional organization; and addressing the dramatic demographic shift that is taking place in Asia.

The annual Stanford Kyoto Trans-Asian Dialogue is made possible through the generosity of the City of Kyoto, the Freeman Spogli Institute for International Studies at Stanford University, and Yumi and Yasunori Kaneko.

Kyoto International Community House Event Hall
2-1 Torii-cho, Awataguchi,
Sakyo-ku Kyoto, 606-8536
JAPAN

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Corporate Affiliate Visiting Fellow
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Ryo Masuda is a corporate affiliate visiting fellow at the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) for 2012-13.  Masuda has more than six years of experience in media markets working for Sumitomo Corporation, one of Japan's major trading and investment conglomerates.  Most recently, Masuda worked for Japan's largest CATV operator, one of Sumitomo Corporation's affiliated companies, where he was responsible for business development.  Masuda graduated from Hitotsubashi University with a bachelor's degree in commercial science.

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Recent academic papers have shown that the Japanese sovereign debt situation is not sustainable. The puzzle is that the bond rate has remained low and stable. Some suggest that the low yield can be explained by domestic residents’ willingness to hold Japanese government bonds (JGBs) despite its low return, and that as long as domestic residents remain home-biased, the JGBs are sustainable. About 95% of JGBs are currently owned by domestic residents. This paper argues that even with such dominance of domestic investors, if the amount of government debt breaches the ceiling imposed by the domestic private sector financial assets, the JGB rates can rapidly rise and the Japanese government can face difficulty rolling over the existing debt. A simulation is conducted on future paths of household saving and fiscal situations to show that the ceiling would be breached in the next 10 years or so without a drastic fiscal consolidation. This paper also shows that the government debt can be kept under the ceiling with sufficiently large tax increases. The JGB yields can rise even before the ceiling is hit, if the expectation of such drastic fiscal consolidation disappears. This paper points out several possible triggers for such a change in expectation. However, downgrading of JGBs by credit rating agencies is not likely to be a trigger, since past downgrades have not produced any change in the JGB yield. If and when the JGB rates rapidly rise, the Japanese financial institutions that hold a large amount of JGBs will sustain losses and the economy will suffer from fiscal austerity, financial instability, and inflation.

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The National Bureau of Economic Research
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Takeo Hoshi
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Original version published in the 2007–08 Shorenstein APARC Annual Overview

Since 2005, Denise Masumoto has managed Shorenstein APARC’s Corporate Affiliates Visiting Fellows Program. Each summer, Masumoto welcomes a new group of fellows and their families to the Center, and helps them to navigate their new country. She also oversees the program curriculum and connects fellows with Center faculty who share their research interests.

How has the program changed since you took over?

When I started at Shorenstein APARC, the program was well established, and it gets better every year. Today, there is more interaction with our faculty and other scholars, which produces better research. The core research goal remains constant, but the changing composition of each group—more female fellows, varied professional backgrounds, new countries joining the mix—keeps the program exciting and unique.

What is the biggest challenge that visiting fellows face when they enter the program?

Definitely deciding which events to attend! In addition to the classes they audit, and the calendar of seminars and site visits arranged specifically for the visiting fellows, there are numerous events within the Center, at our parent institute FSI, all around the Stanford campus, and into Silicon Valley and the greater San Francisco Bay Area. The fellows’ schedules are busy and filled with great opportunities to learn new things and to network; the biggest decision is how to prioritize. What the visiting fellows put into the program is what they get out of it.

How do the visiting fellows integrate into the Center and the University?

I strongly encourage all the visiting fellows to get out and meet people, in Shorenstein APARC and beyond, and to ask lots of questions. Whether this is done in the classroom, at a seminar or conference, or in front of the coffee pot, meeting people and having conversations are valuable parts of their experience. You never know who you might meet, what you might learn, or where it might lead.

In what ways do the visiting fellows contribute to the Center’s research mission?

Research is a continuous process and one that requires feedback and exchange. Our visiting fellows have the opportunity to interact with and learn from our distinguished faculty. At the same time, the knowledge and practical experience that they bring to the Center provide insight and international perspective.

How do the visiting fellows benefit?

In April 2008, we met with affiliate organizations in Japan so we could better understand their objectives. We learned that the affiliate organizations recognize that the program’s value lies in allowing the visiting fellows to take advantage of Stanford’s resources, to develop their professional skills, to expand their international network, and, crucially, to have their way of thinking completely changed. The visiting fellows return home with a fresh perspective on and renewed enthusiasm for their work.

What happens after the program ends each year?

While they are at Stanford, the visiting fellows develop strong relationships with other members of their class. We want this to continue after they return home. Many of our alumni are now in prominent positions within their organizations.

I am focused on growing the network of alumni by maintaining and improving a comprehensive database, which will make it easy for former fellows to stay in touch with one another and with the Center.

Masumoto returned to Japan this autumn to visit with affiliate organizations, and to reconnect with alumni during a reception that was held in Tokyo on September 10.

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Site visit to Palo Alto Utilities by 2009-10 Visiting Fellows.
Denise Masumoto
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Former U.S. Ambassador to Afghanistan Karl Eikenberry has been awarded a William J. Perry Fellowship in International Security at Stanford’s Center for International Security and Cooperation (CISAC), where he will continue to address emerging security challenges facing the United States.

Ambassador Eikenberry has an ambitious agenda for the coming academic year, which includes teaching and mentoring students, public speaking and working closely with former Secretary of Defense William Perry. He also will take part in activities at the Walter H. Shorenstein Asia-Pacific Research Center (APARC), such as the new China and the World research initiative.

“It’s a lifetime honor to receive the Perry Fellowship,” says Eikenberry. “I can’t think of an American in modern times who has better exemplified inspirational commitment to public service than Dr. William Perry. And I can’t think of a better institute of higher learning to be associated with than Stanford University.”

Ambassador Eikenberry has been at Stanford since September 2011 as the Frank E. and Arthur W. Payne Distinguished Lecturer and is an affiliated faculty member for CISAC, APARC and the Center on Democracy, Development and the Rule of Law (CDDRL), as well as research affiliate at the Europe Center – all policy research centers within Stanford’s Freeman Spogli Institute of International Studies.

Before coming to Stanford, Ambassador Eikenberry led the civilian surge directed by President Obama from 2009 to 2011 in an effort to reverse the momentum gained by insurgents, and set the conditions for a transition to Afghanistan sovereignty. He retired from his 35-year military career in April 2009 with the rank of U.S. Army Lieutenant General after posts including commander and staff officer with mechanized, light, airborne and ranger infantry units in the United States, as well as Korea, Italy and as the Commander of the American-led Coalition Forces from 2005-2007.

"Karl Eikenberry's record of public service amply demonstrates his unique qualities, not only as a leader of the American military at a challenging time, but as a strategic thinker and an insightful diplomat,” says CISAC Co-Director Mariano-Florentino Cuéllar. “He has a rare understanding of the profound challenges facing our world, and has been a tremendous asset to CISAC and Stanford.”

Ambassador Eikenberry’s research areas include U.S. strategy in the Asia-Pacific region; China’s evolving security strategy; the United States and NATO; the future of the U.S. military; Washington’s policies in Central and South Asia; and assessing the risks of military intervention.

The fellowship was established to honor Perry, the 19th U.S. secretary of defense and former CISAC co-director, and to recognize his leadership in the cause of peace. Perry is co-director of the Preventive Defense Project and the Nuclear Risk Reduction Initiative at CISAC and is an expert on U.S. foreign policy, national security and arms control. Perry Fellows spend a year at CISAC conducting policy-relevant research on international security issues. They join other distinguished scientists, social and political scientists and engineers who work together on problems that cannot be solved within a single field of study.

Ambassador Eikenberry is a graduate of the U.S. Military Academy, has master’s degrees from Harvard University in East Asian Studies and Stanford University in Political Science, and was a National Security Fellow at the Kennedy School of Government at Harvard. He earned an Interpreter’s Certificate in Mandarin Chinese from the British Foreign Commonwealth Office while studying at the United Kingdom Ministry of Defense Chinese Language School in Hong Kong, and has an Advanced Degree in Chinese History from Nanjing University in the People’s Republic of China.

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South Korea remains a puzzle for political economists. The country has experienced phenomenal economic growth since the 1960s, but its upward trajectory has been repeatedly diverted by serious systemic crises, followed by spectacular recoveries. The recoveries are often the result of vigorous structural reforms that nonetheless retain many of South Korea's traditional economic institutions. How, then, can South Korea suffer from persistent systemic instability and yet prove so resilient? What remains the same and what changes?

The contributors to this volume consider the South Korean economy in its larger political context. Moving beyond the easy dichotomies—equilibrium vs. disequilibrium and stability vs. instability—they describe a complex and surprisingly robust economic and political system. Further, they argue that neither systemic challenges nor political pressures alone determine South Korea's stability and capacity for change. Instead, it is distinct patterns of interaction that shape this system's characteristics, development, and evolution.

Desk, examination, or review copies can be requested through Stanford University Press.

 

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Corporate Restructuring and System Reform in South Korea

Authors
Jean C. Oi
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Shorenstein APARC
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OnlyBeautiful 01

Coverage of the Democratic People’s Republic of Korea (DPRK) all too often focuses solely on nuclear proliferation, military parades, and the personality cult around its leaders. As the British ambassador to North Korea, John Everard had the rare experience of living there from 2006, when the DPRK conducted its first nuclear test, to 2008, just before Kim Jong Il’s stroke. While stationed in Pyongyang, Everard’s travels around the DPRK provided him with numerous opportunities to meet and converse with North Koreans.

Only Beautiful, Please goes beyond official North Korea to unveil the human dimension of life in that hermetic nation. Everard recounts his impressions of the country and its people, his interactions with them, and his observations on their way of life. He provides a picture as well of the life of foreigners in this closed society, considers how the DPRK evolved to its current state, and discusses the failure of current approaches to tackle the challenges that it throws up. The book is illustrated with striking and never-before-seen photographs taken by Everard during his stay in North Korea.

Desk, examination, or review copies can be requested through Stanford University Press.

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A British Diplomat in North Korea

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Shorenstein APARC
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