Parts, Structures, Systems and Outcomes

China News

China's Hu to Go to Japan China said its president, Hu Jintao, will go to Japan on Tuesday for the first trip there by a Chinese head of state in a decade, highlighting improving ties between the two neighbors. Mr. Hu's planned five-day visit is the clearest sign yet that Asia's two largest economies are moving beyond longstanding political disputes that have often overshadowed mushrooming trade and investment ties. The trip comes slightly more than a year after one by Chinese Premier Wen Jiabao that signaled the shift toward improving relations after the departure of former Japanese Prime Minister Junichiro Koizumi. Relations under Mr. Koizumi were marked by rancor partly because of Chinese anger over his repeated visits to the Yasukuni shrine, which honors about 2.5 million Japanese war dead, including 14 convicted Class-A war criminals from World War II. Japan has apologized for its occupation of China from the 1930s until the end of that war, but Beijing has said that those apologies are insufficient given the atrocities it says Japanese soldiers committed in China.

Protests of the West Spread in China Nationwide demonstrations against a French supermarket chain spread on Sunday as thousands of people protested what they said was France’s sympathy for pro-Tibetan agitators. The protesters have also been singling out Western news outlets, especially CNN, for what they said was biased coverage of unrest in Tibet. In a sign that the government was still allowing anti-foreign sentiment to spill over into rare street demonstrations, thousands of people rallied on Sunday in front of Carrefour markets in six cities, including two, Harbin and Jinan, where there had not been protests earlier. Demonstrators carried banners saying, “Oppose Tibet Independence” and “Condemn CNN,” according to the official Xinhua News Agency. The rallies are the largest public outpouring of nationalistic fury since 2005, when tens of thousands of people took to the streets to denounce Japanese textbooks that omitted any mention of Japan’s wartime atrocities in China.

China to Meet Dalai Lama Envoy China's surprise offer to meet with representatives of the Dalai Lama raises new hopes for detente between the bitter adversaries, but also poses a challenge for leaders on both sides: How to placate younger generations convinced that there's no room for compromise. There is little so far to indicate that new talks would achieve more than six previous rounds of negotiations, held between 2002 and 2007. Envoys of the Chinese government and the Dalai Lama made little progress on Tibet's links to China -- such as agreeing when it was, and wasn't, historically part of the country, for example -- or steps to broaden Tibet's autonomy under Chinese rule. The Dalai Lama has stopped short of calling for Tibet's independence. He has said Tibet could use China's help in modernizing its economy, as long as it safeguarded the culture and language. The Dalai Lama also wants China to widen the "autonomous region" of Tibet to include other Tibetans in neighboring Chinese provinces so they could share the same geographic zone. The mere prospect of new talks raises acute complications for both sides. Beijing must shield itself from criticism at home that it is ceding ground to the Dalai Lama, who -- partly because of China's own government propaganda machine -- has become the subject of intense public anger in recent weeks. For the Dalai Lama, failure could erode support for his moderate "Middle Way," which stresses greater autonomy for Tibet, as opposed to outright independence. Unsuccessful talks could also mean the 72-year-old Nobel Peace Prize laureate loses one of his last real chances to push his agenda.

Angry China CHINA is in a frightening mood. The sight of thousands of Chinese people waving xenophobic fists suggests that a country on its way to becoming a superpower may turn out to be a more dangerous force than optimists had hoped. But it isn't just foreigners who should be worried by these scenes: the Chinese government, which has encouraged this outburst of nationalism, should also be afraid. For three decades, having shed communism in all but the name of its ruling party, China's government has justified its monopolistic hold on power through economic advance. Many Chinese enjoy a prosperity undreamt of by their forefathers. For them, though, it is no longer enough to be reminded of the grim austerity of their parents' childhoods. They need new aspirations. The government's solution is to promise them that China will be restored to its rightful place at the centre of world affairs. Hence the pride at winning the Olympics, and the fury at the embarrassing protests during the torch relay. But the appeal to nationalism is a double-edged sword: while it provides a useful outlet for domestic discontents (see article), it could easily turn on the government itself. China's rage is out of all proportion to the alleged offences. It reflects a fear that a resentful, threatened West is determined to thwart China's rise. The Olympics have become a symbol of China's right to the respect it is due. Protests, criticism and boycott threats are seen as part of a broader refusal to accept and accommodate China. There is no doubt genuine fury in China at these offences; yet the impression the response gives of a people united behind the government is an illusion. China, like India, is a land of a million mutinies now. Legions of farmers are angry that their land has been swallowed up for building by greedy local officials. People everywhere are aghast at the poisoning of China's air, rivers and lakes in the race for growth. Hardworking, honest citizens chafe at corrupt officials who treat them with contempt and get rich quick. And the party still makes an ass of the law and a mockery of justice. Herein lies the danger for the government. Popular anger, once roused, can easily switch targets.

A Tea From the Jungle Enriches a Placid Village The rolling hills of China’s southern Yunnan Province are the birthplace of tea, anthropologists say, the first area where humans figured out that eating tea leaves or brewing a cup could be pleasant. Today tea farmers preside over large plantations, but they want their tea the way their forebears consumed it: brewed from wild leaves, and preferably from ancient trees in the jungle. “It has a fragrant smell,” Mr. Yao said of his favorite, harvested from trees at least a century old. “And when you swallow there’s a sweet aftertaste.” From relative obscurity a few decades ago, tea from Yunnan, especially Pu’er, has become a fashionable, must-have variety in the tea shops of Hong Kong, Shanghai and Beijing. Surging demand for Pu’er — often advertised as wild tea even if it is from the plantations — has made farmers here rich and encouraged entrepreneurs to carve out more plantations from jungle-covered hillsides. Ninety percent of the 23,000 tons of Pu’er tea produced last year was grown on plantations, officials say. Local residents seem more than happy to send it to distant locales. They complain about its hard edges — too bitter — and the chemicals that are regularly sprayed on the plants to repel bugs, viruses and fungus.

China and the World 

You have 7 years to learn Mandarin But a recent study by the economist Angus Maddison projects that China will become the world's dominant economic superpower much sooner than expected - not in 2050, but in 2015. While short-term investors are already cashing in on China's growth by playing the global commodities boom, smart long-term thinkers are contemplating what happens when China matures from an exporter of cheap goods to a competitor in sectors where the U.S. is dominant - technology, brand building, finance. China has almost wiped U.S. makers of low-value items like toys and socks, but by 2015 it may threaten Apple J.P. Morgan Chase and Procter & Gamble. It will increasingly influence the S&P 500 and the mutual funds in our 401(k)s. So it's worth looking at how that will happen, what it means, and what anyone can do in the seven years before the baton is passed. If that happens, America will close out a 125-year run as the No. 1 economy. We assumed the title in 1890 from - guess who. Britain? France? No. The world's largest economy until 1890 was China's. That's why Maddison says he expects China to "resume its natural role as the world's largest economy by 2015." That scenario makes sense. China was the largest economy for centuries because everyone had the same type of economy - subsistence - and so the country with the most people would be economically biggest. Then the Industrial Revolution sent the West on a more prosperous path. Now the world is returning to a common economy, this time technology- and information-based, so once again population triumphs. So how should we make the most of our seven-year grace period? For companies: Focus on getting better at your highest-value activities. Just because the Chinese will be fighting you in the same industries doesn't mean you'll lose. (Investors, remember that China bought $3 billion of Blackstone (BX) at the IPO price of $31 last summer, and the firm is now trading at $19.) It only means you'll have to work harder to win. For individuals: You can avoid competition with Chinese workers by doing place-based work, which ranges in value from highly skilled (emergency-room surgery) to menial (pouring concrete). But the many people who do information-based work, which is most subject to competition, will have to get dramatically better to be worth what they cost. For government leaders: Improve U.S. education above all.

Economy and Business 

Talking Business: Horatio Alger Multiplied by 1.3 Billion You hear constantly that China is a country of young people — the average age is 33 — but you really see it in business, where just about everybody seems to be under the age of 40. For people over the age of 50, sadly, as Mr. Feng said, they had no chance. The risk-taking impulse, and so much else, was crushed by the Cultural Revolution. Secondly, it’s a reminder just how quickly China’s economic rebirth has taken place. Mao Zedong died in 1976. Four years later, the country’s first special economic zone, explicitly created to encourage entrepreneurial capitalism, was established in the southern city of Shenzhen. What China has done in less than three decades is nothing short of astonishing. As Byron Wien, the chief investment strategist for Pequot Capital Management, wrote last summer, “Nothing I have read, heard or seen will dissuade me from my view that China has made more economic progress in the last 30 years than any country in history.” It is impossible to visit today’s China and disagree. Third, modern China surely shows that trickle-down economics is not just supply-side propaganda. Deng Xiaoping, the driving force behind the move to capitalism after Mao’s death, famously said, “To get rich is glorious.” And goodness knows, lots of people have gotten rich. But look at what else happened: motivated by the prospect of wealth, people started companies. And as those companies succeeded, millions of new jobs were created. In Shanghai — a place with more entrepreneurial energy than any place I’ve ever visited, including Silicon Valley in the 1990s and Houston during the 1980s oil boom — you can practically see wealth being created before your very eyes. If Shanghai doesn’t make you a believer in the power of capitalism to improve lives, nothing will.

MIT Economist Cracks Big Puzzle of China's Rise: Andy Mukherjee One of the enduring mysteries of our times is how China has created capitalism out of thin air. Throughout history, countries have needed to secure private- property rights and impose limits on state power in order for entrepreneurs to take risks, for bankers to lend money to people other than the king's cousin and for economies to grow. Not communist China. The spectacular success of the Chinese economy in the past two decades seems to suggest to many analysts that good institutions may not really be as fundamentally important to a country as they are cracked up to be. This isn't an idle, academic debate. Our perception of what makes China successful has serious implications for how we analyze the prospects for the rest of the developing world. If the most fascinating economic miracle of our times can soar in an institutional vacuum, then surely others can, too. Now, that may only sound right to Mugabe and his cronies. So what's missing here? The answer, according to Massachusetts Institute of Technology economist Yasheng Huang, is simple: The conventional view of China is deeply flawed. Institutions, as Huang argues in his forthcoming book, titled ``Capitalism With Chinese Characteristics,'' have mattered as much in China as elsewhere, only their effect doesn't show up as neatly. So what happened to Deng's legacy? Following the 1989 Tiananmen protests, political support for genuine entrepreneurship disappeared in the China of the 1990s. Jiang Zemin and Zhu Rongji preferred growth that was led by foreign capital and occurred in urban centers. For businessmen away from large cities, access to finance dried up just as it was promising to become more liberal. The current leadership of President Hu Jintao and Premier Wen Jiabao is aware of the challenge that faces them: The gap between rural and urban wages has widened alarmingly; the share of labor in national income has fallen; inequalities between rich coastal provinces and poor landlocked regions have risen. In the early 1980s, freedom from the fear of incarceration was enough to prompt millions of people to start their own businesses. The institutional changes that are needed now will have to be much more substantive.

Chinese stocks still aren't attractive Does Dessauer consider Chinese stocks to represent a good value today, with the Shanghai Composite index trading at barely more than half its high set last fall? In a word, no. For starters, Dessauer is concerned about the speculative motivation of most individual Chinese investors in Chinese stocks, and what it would do to the prices of those stocks if and when they decide to pull out en masse. In addition to being concerned about the speculative nature of the Chinese stock market, Dessauer also worries about the "lack of managerial talent in China. Mao killed or severely punished most intellectuals, or any talented people. An entire generation of managerial talent is missing in China. It takes a long time to create managerial talent. China has been making progress with education and training but the problem is still far from solved." A third source of concern for Dessauer is "the difficult issue of guanxi, the intertwining of personal and business relationships, which leads to what we would call corruption or nepotism. In China, it has become ingrained that you combine personal and business relationships... I have visited many companies in China -- public, private and state-owned. The business culture is slowly changing, but it is still common to find high-level managers who do not know what 'profit' means, never mind shareholders. There is still a question about who owns what ...

Culture and Values

Of Musical Import Tan Dun has made a career of infusing Western music with Chinese traditions and myths. But on what vision of China does his success in the West depend? A trim, close-cropped man who likes to dress fashionably in dark colors and black leather pants, Tan Dun is a kind of rock star of the modern music scene. He won an Oscar for the score of Ang Lee’s film “Crouching Tiger, Hidden Dragon.” His latest opera, “The First Emperor,” starring Plácido Domingo, had its premiere at New York’s Metropolitan Opera in 2006 and will be revived there this week, with a few changes, mostly to the libretto. Hopping around the world, from Shanghai to Stockholm, from Tokyo to New York, he conducts and introduces his own music to a global audience of rapturous fans. It has indeed been a remarkable journey from rural Hunan to the audience of billions. Tan was born in 1957. Although his earliest memories, as he relates them in public, are full of Taoists, shamans and village sorcerers, his parents were professionals in Changsha, the provincial capital. His mother was a medical doctor, and his father worked at a food research institute. But he was partly raised by his grandmother, a vegetable farmer, who told him ghost stories, which he adored. Since traditional music of any kind, folk or opera, was banned during the Cultural Revolution, which began in 1966 and lasted more or less until 1976, Tan’s main introduction to music consisted of a few permitted revolutionary works. I repeated something Tan said about the need for modern Chinese artists to retain a certain innocence. Tan told me how he had tried to avoid being too sophisticated. “If you are too sophisticated,” he said, “you lose courage.” Theory, he maintained, “makes for more boundaries. Competing with the Europeans, by being more sophisticated, is to resist yourself. One plus one makes one. Yin and yang, inside and outside, honesty and pretension. I have practiced this philosophy for the last 20 years.” Tan’s claim, of course, is that his music does emerge from his experience, from the ghost stories, Buddhist prayers and village shamans of his youth. One of his most striking pieces, a multimedia event for cello, video and orchestra, called “The Map,” was actually performed in Xiangxi, a village in rural western Hunan, where Tan once met a shaman, known as “the stone man,” who could talk to the winds and the clouds. Out of this encounter, he says, came the music, written for Yo-Yo Ma in 1999. The more-or-less Western sound of the cello is mixed with Chinese folk singing and the sounds of rushing water and clashing stones.

Serve the People!' By YAN LIANKEIn Yan Lianke’s satirical novel, a fervent Maoist is seduced by the wife of his commanding officer. You can’t get better publicity for a book than “Banned in Boston.” But as product endorsements go, “Banned in China” sends a more mixed message, even if it still wins points for piquancy. “Serve the People!,” smoothly translated by Julia Lovell, offers an initial sample of Yan Lianke’s writing to an English-speaking audience. A bluntly drawn, mildly erotic fable, it teases Mao Zedong by poking fun at a true believer who obeys the Chairman’s precepts too literally. To a Western sensibility, the broad strokes of Yan Lianke’s humor would seem to pose little risk of inciting rebellion, whether of the flesh or of the body politic. But then, part of the book’s attraction is that it doesn’t have a Western sensibility. It lets the reader see — or rather, intuit — what jokes Chinese officials don’t consider funny, and how very little it takes for a writer to be branded an incendiary in 21st-century China..

'The Song of Everlasting Sorrow' By WANG ANYI Wang Anyi’s novel spans four decades in the life of a woman making her way in a rapidly changing China. its heroine, Wang Qiyao, is on her way to a pawn shop when she runs into Mr. Cheng, a friend she hasn’t seen in 12 years. A portrait photographer, Mr. Cheng had taken Wang Qiyao’s photo in the late 1940s; the picture appeared in a magazine, and she went on to win third place in the Miss Shanghai beauty contest, the pinnacle of her career. By the time they meet again, it is 1960. Tragedy and ill-starred romance have ruined Wang Qiyao’s reputation; she is pregnant with the child of a lover whose identity she refuses to reveal. Food shortages have pushed China to the brink of famine, so Mr. Cheng, taking pity on her, invites Wang Qiyao to share his modest lunch of rice and salt pork. At his apartment, “after her eyes had adjusted to the darkness, she saw that the little world inside had barely changed; it was as if the little room had been encased in a time capsule. ... Wang Qiyao failed to understand that it is precisely this myriad of unchanging little worlds that serves as a counterfoil to the tumultuous changes taking place in the outside world.” These observations could stand as an epigraph for this beautiful novel, which considers, among its many themes, the question of what endures and what remains the same — what resists the passage of time and what succumbs to the forces of cataclysmic social change.

'Wolf Totem' By JIANG RONG Jiang Rong’s novel is set in the pristine grasslands of Inner Mongolia in the 1960s. Lu Xun, China’s most revered modern writer, was a student of medicine in 1906 when he saw a lantern slide of Japanese soldiers decapitating a Chinese prisoner. It was a particularly low moment in China’s national self-esteem, and what appalled Lu Xun most was the passivity of the Chinese spectators. “The people,” he later wrote, “of a weak, backward country, even though they may enjoy sturdy health, can only serve as the senseless material of and audience for public executions.” Convinced that art could goad his compatriots toward “spiritual transformation,” he presented them in his first story, “The Diary of a Madman,” as hypocritical cannibals. His later work abounded in such pitiless depictions, inaugurating a modern Chinese literature marked by what the critic C. T. Hsia called “an obsessive concern with China as a nation afflicted with a spiritual disease and therefore unable to strengthen itself or change its set ways of inhumanity.”

Certainly history imposed this tormented self-reckoning on Chinese writers. For much of the 20th century, their country suffered prodigious violence and social trauma: millions were consumed by the civil war, the Japanese invasion and Maoist disasters like the Great Leap Forward and the Cultural Revolution. In comparison, China in the last decade has known extraordinary stability. The middle class in particular has enjoyed undreamed of affluence — so much so that the great popularity of Jiang Rong’s long, bleak novel about an obscure province inhabited by an ethnic minority is deeply intriguing. Set during the Cultural Revolution, “Wolf Totem” describes the education of an intellectual from China’s majority Han community living with nomadic herders in the grasslands of Inner Mongolia.

'Life and Death Are Wearing Me Out' By MO YAN The Chinese writer Mo Yan’s wildly visionary and creative new novel covers almost the entire span of his country’s revolutionary experience, from 1950 until 2000, while constantly mocking and rearranging itself and jolting the reader with its own internal commentary. Mo Yan’s powerful new novel, “Life and Death Are Wearing Me Out,” contains many such vivid set pieces. His canvas covers almost the entire span of his country’s revolutionary experience — from 1950 until 2000, in the so-called “reform era” of post-Deng Xiaoping China. At one level, therefore, “Life and Death” is a kind of documentary, carrying the reader across time from the land reform at the end of the Chinese Civil War, through the establishment of mutual-aid teams and lower-level cooperatives in the early and mid-1950s, into the extreme years of the Great Leap Forward and the famine of the late ’50s and early ’60s, and on to the steady erosion of the collective economy in the new era of largely unregulated “capitalism with socialist characteristics.” At the novel’s close, some of the characters are driving BMWs, while others are dyeing their hair blond and wearing gold rings in their noses. Yet although one can say that the political dramas narrated by Mo Yan are historically faithful to the currently known record, “Life and Death” remains a wildly visionary and creative novel, constantly mocking and rearranging itself and jolting the reader with its own internal commentary. This is politics as pathology.

China’s Pop Fiction The most successful writer in China is Guo Jingming, a cross-dressing, image-obsessed pop idol whose tales of alienated urban adolescence appeal to the lonely children of China’s one-child generation. The most critically acclaimed Chinese novels of recent years — “Wolf Totem” (a parable about the death of Mongolian culture and a veiled critique of the Cultural Revolution), Yu Hua’s “To Live,” Mo Yan’s “Republic of Wine” — generally use their characters as vessels for broad social and political commentary. But Guo’s novels focus on the tortured psyches of his adolescent characters, who either nurse their melancholy by sitting alone for long hours under trees and on rooftops, or try to blunt it with drinking, fighting and karaoke. “My main goal is to tell the story well and have everyone like it,” Guo said recently in a telephone interview. Which isn’t to say he traffics entirely in escapism. For all the over-the-top melodrama and brand-name dropping, his novels’ contemporary urban settings, Guo said, are far closer to the reality of his readers’ lives than the harsh countryside of China’s modern classics. And his frothy novels, though often denounced as “chain-manufactured writing,” do reflect social issues in their own way.

Readings

Knowing China by Gregory C. Chow. This invaluable book offers an insight into China through its history, culture, people, economy, education, science and technology, as well as government and political system. The author also compares the "twin" cities of Hong Kong and Shanghai, and describes places of interest in the world’s most populous country. In addition, he offers a glimpse into the delicate China–US relations, highlighting partnership opportunities between the two giant economies. The book is based on the author’s knowledge accumulated over five decades of research, teaching, traveling, directing projects on China, and working with Chinese government officials, educators, academics and entrepreneurs.

China Transformed: Historical Change and the Limits of European Experience by R. Bin Wong. This interesting book is an attempt to look at Chinese history in an unbiased manner. Professor Wong notes correctly that interpretations of many scholars are distorted by judging Chinese history by its deviations from what is presumed to be the normative, or desired, course of development. The normative standards, of course, are derived from European history. Wong makes the very good point that using European history in this way is damaging not only to the study of Chinese history but also imposes distortions on the study of European history. Wong is concerned particularly with examining Chinese economic development and state formation. This book covers a very wide sweep of Chinese history, roughly from the Ming to contemporary China. The book is divided into 3 components; one comparing China and Europe in the pre-industrial period of the 17th and 18th centuries, one looking at the response of the Chinese state and society to the great challenges of the 19th century.

Wealth of Man by Peter Jay. Quixotic it may appear to proffer a one-volume history of the world economy that holds interest, but Jay succeeds. Exhibiting the flair of a journalist and the worldly wisdom of a finance official, both of which professions occupied him in Britain, Jay jaunts from the dawn of agriculture to the globalized present. His story adheres to a highly serviceable metaphor for humanity's work for wealth: the waltz. First, an advance increases wealth; the increase attracts political attention; and the threat to wealth from politics eventuates in rules to regulate or protect wealth from capricious avarice. Commanding a capacious fund of information, Jay advances illustrations of his waltz motif from the first recorded wars in the Fertile Crescent to wealth's modern three-step in China. Yet Jay's erudition is not designed for impressing readers, but for informing them about the buildup of the material platform of contemporary civilization--about which most are unreflecting. Far from an apology for laissez-faire, Jay's accessible, nontechnical history outlines wealth's accumulations and dissipations as a way of cautioning against sanguine expectations of unending prosperity.

The Birth of Plenty : How the Prosperity of the Modern World was Created by William Bernstein Rather than dry academic analysis, Bernstein, in his second book (after Four Pillars of Investing), has created a vital, living text-a cogent, timely journey through the economic history of the modern world. He identifies institutions ("the framework within which human beings think, interact and carry on business") as the engines of prosperity. Boiled down to four (property rights, the scientific method, capital markets and communications), these institutions come from ideas and practices that bubbled forth over the course of hundreds of years. Bernstein is clear in explaining that the civilizations that develop and implement these systems thrive, and that those that do not, perish. The Spanish empire, for example, had most of these but lacked effective capital markets. When the gold from the New World dried up, the empire essentially went broke. By 1840 the British had all of these institutions in place, economic growth exploded and the lot of the common man was immensely improved. Today, the U.S. faces the challenge of sustaining prosperity in the face of rapid technological change. Though fairly Eurocentric in focus, Bernstein's narrative tracks the development of these essential ingredients to prosperity over a global landscape-the great dynasties of China get plenty of attention here, as do the Japanese. Solid writing and poignant assessments of the economic players throughout time give texture and flavor to Bernstein's argument: he describes the medieval relationship between the various European kingdoms and the Vatican as "a holy shakedown racket." Packed with information and ideas, Bernstein's book is an authoritative economic history, accessible and thoroughly entertaining.

'A Splendid Exchange' The world is knit together as never before with a cat’s cradle of trade, which has already had immense consequences and will have many more. But while global trade has been much in the news lately, especially during this election year, it has an extremely long history. As William J. Bernstein makes clear in his entertaining and greatly enlightening book “A Splendid Exchange,” it has been a major force in driving the whole history of humankind. Equally important, skills and talents are not evenly distributed across the human landscape, nor are the world’s resources equally distributed across the natural one. Since humans also have a propensity to bash in one another’s skulls, we have always traded for what we wanted or raided for it. Ancient Mesopotamia was richly endowed with fertile soils and water from the Tigris and Euphrates rivers, but it lacked stone and wood for building, and metals like copper for tools and weapons. The Sumerians, however, had surplus food to trade, so they could bargain for stone from near the headwaters of the rivers, wood from what is now Lebanon and metal from Sinai, Cyprus and elsewhere. The scope of ancient trade was immense. A single Bronze Age shipwreck around 1350 B.C. near Bodrum, a Turkish coastal town, yielded no less than 10 tons of copper and a ton of tin ingots along with other merchandise like ivory. (The ideal ratio of copper to tin for making bronze is 10 to 1.) By Roman times vast armadas ferried Egyptian grain, Greek wine, Spanish copper and silver, and a hundred other commodities around the Mediterranean. India has yielded rich troves of Roman coins that reached that subcontinent to pay for spices the Romans coveted, especially pepper. Chinese silk — literally worth its weight in gold — traveled through the heart of Asia on the Silk Road to reach markets in the West.

China's Economic Transformation by Gregory C. Chow. In this second edition of the successful book, Gregory Chow uses insights gained from over twenty years of teaching and traveling, as well as his work with government officials and academics, to address the transformation, development, and functioning of China’s economy. Chow combines historical-institutional and theoretical-quantitative approaches to provide a penetrating and comprehensive analysis of the factors that have contributed to China’s economic transformation. Introducing the reader to the inner workings of the Chinese economy and details the process of its transformation into a market economy, Chow observes the economics of institutional changes taking place, the role of China’s government, and the significance of the historic and cultural traditions of the country. Chow’s knowledge of what has happened and what is happening in China helps him identify the major causes of economic change and development. ·  Provides a penetrating and comprehensive analysis of the historical, institutional and theoretical factors that have contributed to China's economic success ·  Reveals new findings concerning the roles of market institutions, Chinese human capital, private ownership, forms of government, political conditions, and bureaucratic economic institutions ·  The new edition covers a diverse set of important issues: environmental restraints; income distribution; rural poverty; the education system; healthcare; exchange rate policies; monetary policies; and financial regulation.