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Data-intensive technologies such as AI may reshape the modern world. We propose that two features of data interact to shape innovation in data-intensive economies: first, states are key collectors and repositories of data; second, data is a non-rival input in innovation. We document the importance of state-collected data for innovation using comprehensive data on Chinese facial recognition AI firms and government contracts. Firms produce more commercial software and patents, particularly data-intensive ones, after receiving government public security contracts. Moreover, effects are largest when contracts provide more data. We then build a directed technical change model to study the state's role in three applications: autocracies demanding AI for surveillance purposes, data-driven industrial policy, and data regulation due to privacy concerns. When the degree of non-rivalry is as strong as our empirical evidence suggests, the state's collection and processing of data can shape the direction of innovation and growth of data-intensive economies.

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David Yang’s research focuses on political economy, behavioral and experimental economics, economic history, and cultural economics. In particular, David studies the forces of stability and forces of changes in authoritarian regimes, drawing lessons from historical and contemporary China. David received a B.A. in Statistics and B.S. in Business Administration from University of California at Berkeley, and PhD in Economics from Stanford. David is currently a Prize Fellow in Economics, History, and Politics at Harvard and a Postdoctoral Fellow at J-PAL at MIT. He also joined Harvard’s Economics Department as an Assistant Professor as of 2020.

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David Yang Prize Fellow in Economics, History, and Politics; Department of Economics, Harvard University
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The book looks into how and why “China’s economy is transitioning to a ‘new normal’ of slower but more balanced and sustainable growth.” It reviews the reallocation of labor from agriculture to industry and notes that it has been a major driving force of China’s economic growth, but the surplus of rural laborers has declined considerably and will continue to decline. China needs “productivity and innovation as new driver of growth” and structural and institutional reform. One of the strategies to achieve reform is to build China’s human capital and make it "the cornerstone of its economy”.

Several REAP publications are cited in chapter 6: Building Human Capital. The chapter talks about education attainment in the labor force, quality disparities across rural and urban residents, school dropout problems, and the importance of early childhood development – all pillars of REAP’s research.

 

Read Excerpts from the Chapter Here

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REAP research is cited in a chapter of a recently published book title, "Innovative China: New Drivers of Growth", written by the World Bank Group and the People’s Republic of China Development Research Center of the State Council.

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China’s role in the COVID-19 outbreak has elicited a growing global backlash, including dueling Republican and Democratic campaign ads, alongside praise for China’s success in curbing the coronavirus and sending medical assistance overseas. How will the pandemic reshape China’s domestic and international standing, and what lies ahead for U.S.-China relations? Weiss will discuss the Chinese government’s pandemic response and what it reveals about the CCP’s domestic and international intentions.

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Jessica Chen Weiss
Jessica Chen Weiss is an associate professor of Government at Cornell University, China/Asia political science editor at the Washington Post Monkey Cage blog and a nonresident Senior Associate at the Center for Strategic and International Studies.  She is the author of Powerful Patriots: Nationalist Protest in China’s Foreign Relations (Oxford University Press, 2014).  Her research appears in International Organization, China Quarterly, International Studies Quarterly, Journal of Conflict Resolution, Security Studies, Journal of Contemporary China, and Review of International Political Economy, as well as in the New York Times, Foreign Affairs, and Washington Quarterly.  She was previously an assistant professor at Yale University and founded FACES, the Forum for American/Chinese Exchange at Stanford, while an undergraduate at Stanford University.  Born and raised in Seattle, Washington, she received her Ph.D. from the University of California, San Diego in 2008, where her dissertation won the 2009 American Political Science Association Award for best dissertation in international relations, law and politics.  Weiss is a term member of the Council on Foreign Relations.


Image of red flag over the Shanghai BundThis event is part of the 2020 Winter/Spring Colloquia series, The PRC at 70: The Past, Present – and Future?, sponsored by APARC's China Program.

 

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Jessica Chen Weiss Associate Professor of Government, Cornell University
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Former Russian President Dmitry Medvedev, who signed the New Strategic Arms Reduction Treaty (New START) with Barack Obama on April 8, 2010, called last week for the United States to agree to extend the treaty. On Friday, a Department of State spokesperson told the Russian news agency TASS in response:  “The President has directed us to think more broadly than New START…  We stand ready to engage with both Russia and China on arms control negotiations that meet our criteria.”

Unfortunately, nothing suggests President Trump will achieve anything on nuclear arms control.

 

Read full article at The Hill.

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This time last year, business in China was booming. In April 2019, Bejing welcomed numerous world leaders and businesspeople at the second annual Belt and Road Forum, a glittering production of statesmanship where partners and potential investors were toasted at gala-style events and received with pomp. China's Belt and Road Initiative (BRI) aims to develop large-scale infrastructure projects, both domestically and internationally, using Chinese firms and funding. The goals set for and promises made by the overall BRI endeavor are broad-reaching in scale and breath-taking in scope, but its realities are incredibly complicated, argues David M. Lampton, the Oksenberg-Rohlen Fellow at APARC.

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In his forthcoming book chapter, “All (High-Speed Rail) Roads Lead to China," Lampton examines the people, organizations, and institutions within China who support and oppose BRI, focusing on the high-speed rail component of the massive endeavor in Southeast Asia. His chapter is part of the upcoming volume, Fateful Decisions: Choices That Will Shape China’s Future, edited by Shorenstein APARC Fellow Thomas Fingar and China Program Director Jean Oi. We sat down with Lampton to talk about some of the tough choices China and partner nations will have to make regarding their continuing support of BRI, particularly in light of the COVID-19 pandemic and its economic fallout.

“No matter where you look," says Lampton, "there are a set of economic, political, military, security risks . . . Big construction infrastructure projects almost all run at least twice as long as initially anticipated and cost at least twice as much on balance . . . So, I think the first thing China's going to see externally is some resentment against the degree of intrusion that something this massive represents."

Listen to the full conversation with Lampton here, or on our SoundCloud channel. A transcript of the conversation is available for download below.

TRANSCRIPT: "All (High-Speed Rail) Roads Lead to China"
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This is the third installment in a series leading up to the publication of Fateful Decisions: Choices that will Shape China's Future (Stanford University Press, available May 2020), edited by Thomas Fingar and Jean Oi. To read the first two parts of this series follow the links below.

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Karen Eggleston Examines China’s Looming Demographic Crisis, in Fateful Decisions

Karen Eggleston Examines China’s Looming Demographic Crisis, in Fateful Decisions
Quote from Thomas Fingar and Jean Oi from, "China's Challeges: Now It Gets Much Harder"
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Now It Gets Much Harder: Thomas Fingar and Jean Oi Discuss China’s Challenges in The Washington Quarterly

Now It Gets Much Harder: Thomas Fingar and Jean Oi Discuss China’s Challenges in The Washington Quarterly
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BEIJING, CHINA - Workers sit near a CRH (China Railway High-speed) "bullet train" at the Beijing South Railway Station under reconstruction.
BEIJING, CHINA - Workers sit near a CRH (China Railway High-speed) "bullet train" at the Beijing South Railway Station under reconstruction.
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In a new audio interview, Lampton discusses some of the challenges, uncertainties, and decisions that loom ahead of China's Belt and Road Initiative.

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Colin H. Kahl
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The novel coronavirus (COVID-19) is a global public health disaster of almost biblical proportions. It is a once-in-a-century occurrence that threatens to destroy countless lives, ruin economies, and stress national and international institutions to their breaking point. And, even after the virus recedes, the geopolitical wreckage it leaves in its wake could be profound.

Many have understandably drawn comparisons to the influenza pandemic of 1918 and 1919. That pandemic, which began in the final months of World War I, may have infected 500 million people and killed 50 million people around the globe. As the grim toll of COVID-19 mounts, it remains to be seen if that comparison will prove apt in terms of the human cost.

But, if we want to understand the even darker direction in which the world may be headed, leaders and policymakers ought to pay more attention to the two decades after the influenza pandemic swept the globe. This period, often referred to as the interwar years, was characterized by rising nationalism and xenophobia, the grinding halt of globalization in favor of beggar-thy-neighbor policies, and the collapse of the world economy in the Great Depression. Revolution, civil war, and political instability rocked important nations. The world’s reigning liberal hegemon — Great Britain — struggled and other democracies buckled while rising authoritarian states sought to aggressively reshape the international order in accordance with their interests and values. Arms races, imperial competition, and territorial aggression ensued, culminating in World War II — the greatest calamity in modern times.

In the United States, the interwar years also saw the emergence of the “America First” movement. Hundreds of thousands rallied to the cause of the America First Committee, pressing U.S. leaders to seek the false security of isolationism as the world burned around them. President Franklin Delano Roosevelt pushed back, arguing that rising global interdependence meant no nation — not even one as powerful and geographically distant as the United States — could wall itself off from growing dangers overseas. His warning proved prescient. The war eventually came to America’s shores in the form of the attack on Pearl Harbor.

Even before COVID-19, shadows of the interwar years were beginning to re-emerge. The virus, however, has brought these dynamics into sharper relief. And the pandemic seems likely to greatly amplify them as economic and political upheaval follows, great-power rivalry deepens, institutions meant to encourage international cooperation fail, and American leadership falters. In this respect, as Richard Haas notes, the COVID-19 pandemic and the aftershocks it will produce seem poised to “accelerate history,” returning the world to a much more dangerous time.

However, history is not destiny. While COVID-19 worsens or sets in motion events that may increasingly resemble this harrowing past, we are not fated to repeat it. Humans have agency. Our leaders have real choices. The United States remains the world’s most powerful democracy. It has a proud legacy of transformational leaps in human progress, including advances that have eradicated infectious diseases. It is still capable of taking urgent steps to ensure the health, prosperity, and security of millions of Americans while also leading the world to navigate this crisis and build something better in its aftermath. America can fight for a better future. Doing so effectively, however, requires understanding the full scope of the challenges it is likely to face.

Read the rest at War on the Rocks

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The novel coronavirus (COVID-19) is a global public health disaster of almost biblical proportions. It is a once-in-a-century occurrence that threatens to destroy countless lives, ruin economies, and stress national and international institutions to their breaking point. And, even after the virus recedes, the geopolitical wreckage it leaves in its wake could be profound.

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Much recent commentary on US relations with China claims that the policy of “Engagement” was a foolish and failed attempt to transform the People’s Republic into an American style democracy that instead created an authoritarian rival. This narrative mocks the policies of eight US administrations to justify calls for “Decoupling” and “Containment 2.0.” Fingar’s talk will challenge this narrative by examining the origins, logic, and achievements of Engagement and explain why Decoupling is neither wise nor attainable.

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Dr. Thomas Fingar
Thomas Fingar is a Shorenstein APARC Fellow in the Freeman Spogli Institute for International Studies at Stanford University. He was the inaugural Oksenberg-Rohlen Distinguished Fellow from 2010 through 2015 and the Payne Distinguished Lecturer at Stanford in 2009. From 2005 through 2008, he served as the first deputy director of national intelligence for analysis and, concurrently, as chairman of the National Intelligence Council. Fingar served previously as assistant secretary of the State Department’s Bureau of Intelligence and Research (2000-01 and 2004-05), principal deputy assistant secretary (2001-03), deputy assistant secretary for analysis (1994-2000), director of the Office of Analysis for East Asia and the Pacific (1989-94), and chief of the China Division (1986-89). Between 1975 and 1986 he held a number of positions at Stanford University, including senior research associate in the Center for International Security and Arms Control.

Fingar is a graduate of Cornell University (A.B. in Government and History, 1968), and Stanford University (M.A., 1969 and Ph.D., 1977 both in political science). His most recent books are The New Great Game: China and South and Central Asia in the Era of Reform, editor (Stanford, 2016), Uneasy Partnerships: China and Japan, the Koreas, and Russia in the Era of Reform (Stanford, 2017), and Fateful Decisions: Choices that will Shape China’s Future, co-edited with Jean Oi (Stanford, 2020).

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Thomas Fingar Shorenstein APARC Fellow, Stanford University
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Product reliability is a key concern for manufacturers. We examine a significant but under-recognized determinant of product reliability: the rate of workers quitting from the product's assembly line, or its worker turnover. While modern manufacturers make extensive efforts to control defects and assure quality worksmanship, some quality variation in the manufactured units may be revealed only after they have been used repeatedly. If this is the case, then the disruptiveness of high turnover may directly lead to product reliability issues. To evaluate this possibility, our study collects four post-production years of field failure data covering nearly fifty million sold units of a premium mobile consumer electronics product. Each device is traced back to the assembly line and week in which it was produced, which allows us to link product reliability to production conditions including assembly lines' worker turnover, workloads, firm learning, and the quality of components. Significant effects manifest in two main ways: (1) In the high-turnover weeks immediately following paydays, eventual field failures are surprisingly 10.2% more common than for devices produced in the lowest-turnover weeks immediately before paydays. Using post-payday as an instrumental variable, we estimate that field failure incidence grows by 0.74-0.79% per 1 percentage increase in weekly turnover. (2) Even in other weeks, assembly lines experiencing higher turnover produce an estimated 2-3% more field failures. We demonstrate that staffing and retaining a stable factory workforce critically underlies product reliability and show the value of connected field data in informing manufacturing operations.

Keywords: Data-driven workforce planning, Empirical operations management, Employee turnover, People 

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Prashant Loyalka
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There is limited evidence on the degree to which differences in implementation among institutions matter for program effectiveness. To examine this question, we conducted an experiment in rural China in which public schools were randomly assigned to one of three treatments: a computer-assisted learning program (CAL) implemented by a government agency, the same program implemented by an NGO, and a pure control. Results show that compared to the pure control condition and unlike the NGO program, the government program did not improve student achievement. Analyzing impacts along the causal chain, we find that government officials were more likely to substitute CAL for regular instruction (contrary to protocol) and less likely to directly monitor program progress. Correlational analyses suggest that these differences in program implementation were responsible for the lack of impacts.

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Journal of Development Economics
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Scott Rozelle
Prashant Loyalka
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We present the results of a cluster-randomized controlled trial that evaluates the effects of a free, center-based parenting intervention on early cognitive development and parenting practices in 100 rural villages in China. We then compare these effects to a home-based intervention conducted in the same region, using the same parenting curriculum and public service system. We find that the center-based intervention significantly improved children’s cognitive skills by 0.11 standard deviations, accompanied by increases in the material investments, time investments, and parenting skills of caregivers. The average impact of the center-based intervention, however, was approximately half that of the home-visiting intervention. Analysis of the possible mechanisms suggests that the difference in effects was driven primarily by different patterns of compliance. Although children with lower levels of initial skills at baseline benefited the most from the center-based intervention, they were less likely to participate in the program.

Keywords: Center-based parenting intervention; home-based parenting intervention; early cognitive development; randomized controlled trial; program participation

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Alexis Medina
Scott Rozelle
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