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In this panel discussion, three leading scholars in the field of China and Taiwan studies examined recent developments and future prospects for Taiwan's participation in international organizations, from the World Health Assembly to a range of other UN-affiliated and other international organizations (including new and less formal groupings such as the Community of Democracies).  More broadly, this panel discussion will examine how Taiwan is now trying to, and might in the near future, engage the international community and international organizations, in an era when relations across the strait are thawing but Beijing is still actively limiting Taiwan's international space.

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The symposium brought together scholars and current and former government officials from Taiwan, China, and US to take stock of cross-strait relations over the past decade. It will also assess the future development of cross-strait interactions from different angles including economic, political, and security perspectives.

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Taiwan’s special municipality elections have been viewed by many as the “mid-term” for the Ma Ying-jeou presidency, bearing important political significance for the 2012 presidential election. In this special seminar, Professor Yun-han Chu, one of the leading political scientists in Taiwan and also President of the Chiang Ching-kuo Foundation, will analyze the recent special municipality elections and their implications for Taiwan’s future political trends. Professor Chu will provide firsthand information about these recent election campaigns and what they reveal about the state of democracy in Taiwan. In analyzing the election results, he will also shed light on how the race for the presidency in 2012 is shaping up.

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Stanford's Center on Democracy, Development, and the Rule of Law (CDDRL) is pleased to announce that undergraduate senior honors student, Anna Barrett Schickele, received the Firestone Medal for Excellence in Undergraduate Research. This university award is given to the top ten percent of honors theses in social science, science, and engineering.

Schickele's thesis entitled, "One Drop At A Time," examines the factors that inform farmers' decisions to use modern irrigation systems in the Lurín Valley of Peru, where she spent several months conducting fieldwork with a Lima-based NGO. Schickele — a public policy major —was able to collect primary data through interviews with farmers and fieldworkers to inform her research study that includes policy recommendations to the NGO community and government officials.

Anna Schickele (center) with Francis Fukuyama (left) and Larry Diamond (right).

Martin Carnoy, the Vida Jacks Professor of Education at the Stanford Graduate School of Education, served as Schickele's thesis advisor together with Rosamond L. Naylor, the director of the Center on Food Security and the Environment at FSI.

"Ana's thesis is an important contribution to our understanding of the barriers and openings for stimulating agricultural development among subsistence farmers," said Carnoy. "Her original insights make the thesis particularly valuable for those addressing development issues in the world’s poorest regions."

In August, Schickele will begin a research position at the Abdul Latif Jameel Poverty Action Lab at the Massachusetts Institute of Technology.

CDDRL's best thesis award was given to Kabir Sawhney, a management science and engineering major, who wrote his thesis on the effect of regime type and the propensity to default on sovereign debt. Advised by Professor of Political Science Gary Cox, Swahney cited the cases of Romania in the 1980s and more recently of Greece to conclude that the quality of government — rather than regime type alone — determines whether a country chooses to default. 

After graduation. Sawhney will join the consulting firm Accenture as an analyst in their San Francisco office.  

Three honors students' received fellowships from Stanford's Haas Center of Public Service to pursue public service-related work after graduation. Keith Calix and Imani Franklin both received the Tom Ford Fellowship in Philanthropy and will be working in New York for grant-making foundations, and Lina Hidalgo received the Omidyar Network Postgraduate Fellowship to work with an international organization.     

The CDDRL Undergraduate Senior Honors Program is an interdisciplinary honors program led by Francis Fukuyama, the Olivier Nomellini Senior Fellow at FSI. The program recruits a diverse group of talented students interested in writing original theses on topics impacting the field of democracy, development, and the rule of law. During the year-long program, students write their thesis in consultation with a CDDRL faculty member, participate in research workshops, and travel to Washington, D.C. for "honors college."

The nine members of the graduating class of 2013 CDDRL undergraduate honors students include:

 

Keith Calix

 

International Relations 

Wie is ek? Coloured Identity and Youth Involvement in Gangsterism in Cape Town, South Africa  

Advisor: Prudence Carter

Vincent Chen

 

Earth Systems; Economics

Democracy and the Environment: An Empirical Analysis and Observations from Taiwan’s Maturing Democracy  

Advisor: Larry Diamond

Holly Fetter

 

Comparative Studies in Race and Ethnicity 

From DC to the PRC: Examining the Strategies and Consequences of U.S. Funding for Chinese Civil Society  

Advisor: Jean Oi

Imani Franklin

 

International Relations

Living in a Barbie World: Skin Bleaching and the Preference for Fair Skin in India, Nigeria, and Thailand  

Advisor: Allyson Hobbs

Mariah Halperin

 

History

Religion and the State: Turkey under the AKP 

Advisor: Larry Diamond

Thomas Hendee

 

Human Biology

The Health of Pacification: A Review of the Pacifying Police Unit program in Rio de Janeiro, Brazil 

Advisors: Beatriz Magaloni & Paul Wise 

Lina Hidalgo

 

Political Science

Tiananmen or Tahrir? A Comparative Study of Military Intervention Against Popular Protest  

Advisors: Jean Oi & Lisa Blaydes

Kabir Sawhney

 

Management Science and Engineering

Repayment and Regimes: The Effect of Regime Type on Propensity to Default on Sovereign Debt    

Advisor: Gary Cox

Anna Schickele

 

 Public Policy

One Drop at a Time: Diffusion of Modern Irrigation Technology in the Lurín Valley, Peru  

Advisors: Martin Carnoy & Roz Naylor

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Amy Zegart, one of the nation’s leading experts on national security, intelligence and foreign policy, has been appointed the next co-director of the Center for International Security and Cooperation.

Zegart, a CISAC faculty member and senior fellow at the Hoover Institution, will take up her new role July 1. She succeeds Mariano-Florentino Cuéllar, who was named director of the Freeman Spogli Institute for International Studies, CISAC’s parent organization.

“Amy Zegart is an award-winning scholar, an accomplished professional with public and private sector experience, and a trusted voice on national security and foreign policy,” said Cuéllar. “Her multi-disciplinary scholarship, diverse experiences, and commitment to getting it right will complement the Freeman Spogli Institute's growing focus on governance problems, and will make her a dynamic leader for CISAC as the center continues its vital work on international cooperation and security.”

Zegart, once named one of the 10 most influential experts in intelligence reform by the National Journal, said she intends to continue expanding the center’s focus on emerging security issues, such as cybersecurity, drones and challenges to governance while building on CISAC’s distinguished reputation in nuclear security.

“The international threat environment is changing faster and in more profound ways than anyone could have imagined 10 or 20 years ago,” said Zegart, who is also a professor of political economy (by courtesy) at the Stanford Graduate School of Business, where she co-teaches a course on managing political risk with former Secretary of State Condoleezza Rice.

“CISAC will continue to be at the forefront of addressing these new challenges with the same secret sauce it’s had since its founding in 1983: world class talent; a commitment to teaching the next generation; and a deep belief that bridging the natural and social sciences is vital to solving the world’s most dangerous problems,” she said.

 CISAC, more than any other institution, provided a scholarly environment that was intellectually challenging and personally supportive at the same time. That’s quite a rare cultural combination."

Zegart’s research examines the organization of American national security agencies and their effectiveness. She served on the Clinton administration's National Security Council staff and as a foreign policy adviser to the 2000 presidential campaign of George W. Bush. She has testified before the Senate Intelligence Committee, provided training to the Marine Corps, and advised officials on intelligence and homeland security matters. From 2009 to 2011 she served on the National Academies of Science Panel to Improve Intelligence Analysis. Her commentary has been featured on national television and radio shows and in The New York Times, Washington Post, and Los Angeles Times.

Zegart writes  regular commentary for Foreign Policy about national security issues. In this excerpt from one of those posts about the privatization of American intelligence and the growing businesses of political risk management, her approach accentuates her ability to bring complex issues to a general audience:

In the old days, the ‘free world’ and ‘Soviet bloc’ were two different universes. Not anymore. Now everything is connected. Sweden’s Ikea has stores in Russia. My CIA alarm clock was made in China. Unrest in Cairo can cause legging shortages in California. And communications happen everywhere. Wifi can be found in Bedouin tents, on the top of Mount Everest, and on buses in rural Rwanda. Kenyan fisherman may lack electricity, but they can check weather conditions and fish market prices on their cell phones. All of this connectedness means that political risks – civil strife, instability, insurgency, coups, weak legal standards, corruption – have more spillover effects. What happens in Vegas does not stay in Vegas.

Zegart recalls being fascinated with politics since she was a kid. She spent her childhood tracking election night tallies and writing her congressman. When she was 13, she followed on TV the late Chinese leader Deng Xiaoping’s historic visit to the United States in 1979 and was thrilled when he donned a cowboy hat at a Texas rodeo.

“I was enthralled,” Zegart said. “My mother, an antique dealer who can find anyone and anything, tracked down a local Taiwanese graduate student and convinced her to teach me Mandarin after school.”

She would continue studying Chinese at Andover, majored in East Asian Studies at Harvard, and would win a Fulbright Scholarship to travel to China and study the 1989 Chinese democracy movement and Tiananmen Square tragedy. Zegart then earned her M.A. and Ph.D. in political science from Stanford and became a full professor of public policy at UCLA’s Luskin School of Public Affairs as well as a fellow at the Burkle Center for International Relations.

Zegart notes she’s been connected to CISAC for more than two decades. She first showed up at the center’s former Galvez House headquarters during her first quarter as a Stanford graduate student. She kept coming back even after she got her Ph.D.; both of her award-winning books were germinated in presentations she gave to CISAC seminars.

“CISAC, more than any other institution, provided a scholarly environment that was intellectually challenging and personally supportive at the same time,” Zegart said. “That’s quite a rare cultural combination.”

This academic year, she co-taught with Martha Crenshaw the popular CISAC-sponsored class International Security in a Changing World, which culminates in a U.N. Security Council simulation in which students debate a pressing global issue.

CISAC has a tradition of appointing co-directors – one from the social sciences and the other from the natural sciences – to advance the center’s interdisciplinary mission to conduct and promote cutting-edge research to make the world a safer place.

“Amy brings to CISAC a wealth of expertise in international security issues, a deep commitment to scholarship and a sincere desire to strengthen and expand the center’s activities and impact,” said David Relman, CISAC’s other co-director, a Stanford microbiologist and professor of infectious diseases, as well as expert on emerging biological threats. “We share an interest in emerging technologies and the effective international mechanisms that address 21st century challenges and threats.”

Zegart is the author of two award-winning books. Flawed by Design, which chronicles the development of the Central Intelligence Agency, Joint Chiefs of Staff, and National Security Council, won the highest national dissertation award in political science. Spying Blind, which examines why American intelligence agencies failed to adapt to the terrorist threat before 9/11, won the National Academy of Public Administration’s Brownlow Book Award. She has also published in International Security, Political Science Quarterly, and other leading academic journals. She serves on the editorial boards of Terrorism and Political Violence and Intelligence and National Security. Her most recent book is Eyes on Spies: Congress and the United States Intelligence Community.

Before her academic career, Zegart spent three years at McKinsey & Company advising Fortune 100 companies about strategy and organizational effectiveness.

She serves on the FBI Intelligence Analysts Association National Advisory Board and the Los Angeles Police Department’s Counter-terrorism and Community Police Advisory Board and is a lifetime member of the Council on Foreign Relations. 

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From executive boardrooms to national capitols, leaders are debating the relative merits of contending models and strategies for attracting, developing, and empowering innovation talent--the people who drive economic growth and value creation through innovation.
 
On June 28, 2013, the Stanford Program on Regions of Innovation and Entrepreneurship (SPRIE) convened a circle of over 50 policymakers, executives and Stanford community members from 12 countries for an interactive roundtable on innovation talent at the Stanford Graduate School of Business.
 
Topics of discussion included:
  • What are key data and trends for innovation talent in Silicon Valley?
  • What strategies are places such as London, Taiwan and Israel employing to become hotbeds of innovation that attract innovation talent?
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    How can companies successfully manage and empower their innovation talent? What best practices have been learned?
  • What insights and implications into innovation talent can be gathered from recent research?
  • How are universities innovating through programs such as Stanford's StartX and the d.school?
Agenda
 

8:30 – 8:45

  Registration
     
8:45 – 9:00   Welcome & Opening Remarks
     
9:00 – 10:15   “The Right Talent, Essentially”
Evan Wittenberg, Senior Vice President, People, Box
Kyung H. Yoon, CEO, Talent Age Associates
Moderator: Greg McKeown (MBA '08), CEO, THIS, Inc.
     
10:15 – 11:10   “The Rx for Innovation”
Baba Shiv, Sanwa Bank, Limited, Professor of Marketing, Stanford Graduate School of Business
     
11:10 – 11:30   Break
     
11:30 – 12:30   “Innovation Talent Spanning Boundaries”
Chunyan Zhou, Director, International Institute of Triple Helix (IITH)
Morten Petersen, Assistant Professor, Aalborg University
Kung Wang, Chair Professor, China University of Technology
Moderator: Henry Etzkowitz, Senior Researcher, H-STAR Institute, Stanford University
     
12:30 – 1:30   Lunch
     
1:30 – 2:10   “Accelerating the Next Generation of Innovation Talent”
Cameron Teitelman (BS '10), Founder & CEO, StartX
Divya Nag
, Founder, StartX Med
     
2:10 – 2:40   “Silicon Valley Perspective”
Russell Hancock, President & CEO, Joint Venture Silicon Valley
     
2:40 – 3:00   Break
     
3:00 – 4:30   “Global Policy Perspectives”
Sigal Admony-Ravid, Consul for Economic Affairs to the West Coast, State Of Israel
Chao-Han Liu, Vice President, Academia Sinica
Priya Guha, British Consul General in San Francisco
Angus Lapsley, Director European & Global Issues, Cabinet Office, United Kingdom
     
4:30 - 5:15   Closing Remarks & Networking Reception

For more information please contact Rustin Crandall at: rustin.crandall@gsb.stanford.edu

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Seawell Family Boardroom
(Bass Center Room B400)
Knight Management Center
Stanford Graduate School of Business

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Abstract: Dr. Wang will be discussing some of the formal governmental and non-governmental collaborative mechanisms between Taiwan, China, Hong Kong, and other countries (including the US) on survaillance and reporting for flu. He will also discuss lessons learned from SARS, including the development of specific policies, protocols, or procedures, and new technologies deployed for public health preparedness.

 

C. Jason Wang, M.D., Ph.D. is an Associate Professor of Pediatrics at the Center for Policy, Outcomes, and Prevention at Stanford University.  He received his B.S. from MIT, M.D. from Harvard, and Ph.D. in policy analysis from RAND.  After completing his pediatric residency training at UCSF, he worked in Greater China with McKinsey and Company, during which time he performed multiple studies in the Asian healthcare market. In 2000, he was recruited to serve as the project manager for the Taskforce on Reforming Taiwan's National Health Insurance System. His fellowship training in health services research included the Robert Wood Johnson Clinical Scholars Program and the National Research Service Award Fellowship at UCLA. Prior to coming to Stanford in 2011, he was an Assistant Professor of Pediatrics and Public Health (2006-2010) and Associate Professor (2010-2011) at Boston University and Boston Medical Center. 

Among his accomplishments, he was selected as the student speaker for Harvard Medical School Commencement (1996).  He received the Overseas Chinese Outstanding Achievement Medal (1996), the Robert Wood Johnson Physician Faculty Scholars Career Development Award (2007), the CIMIT Young Clinician Research Award for Transformative Innovation in Healthcare Research (2010), and the NIH Director’s New Innovator Award (2011). He was recently named a “Viewpoints” editor and a regular contributor for theJournal of the American Medical Association (JAMA).  He served as an external reviewer for the 2011 IOM Report “Child and Adolescent Health and Health Care Quality: Measuring What Matters” and as a reviewer for AHRQ study sections.

Dr. Wang has written two bestselling Chinese books published in Taiwan and co-authored an English book “Analysis of Healthcare Interventions that Change Patient Trajectories”.  His essay, "Time is Ripe for Increased U.S.-China Cooperation in Health," was selected as the first-place American essay in the 2003 A. Doak Barnett Memorial Essay Contest sponsored by the National Committee on United States-China Relations.

Currently he is the principal investigator on a number of quality improvement and quality assessment projects funded by the Robert Wood Johnson Foundation, the National Institutes of Health (USA), Health Resources and Services Administration (HRSA), and the Andrew T. Huang Medical Education Promotion Fund (Taiwan).

Dr. Wang’s research interests include: 1) developing tools for assessing and improving the quality of healthcare; 2) facilitating the use of innovative consumer technology in improving quality of care and health outcomes; 3) studying competency-based medical education curriculum, and 4) improving health systems performance.

CISAC Conference Room

Encina Commons Room 180,
615 Crothers Way,
Stanford, CA 94305-6006

(650) 736-0403 (650) 723-1919
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LCY: Tan Lan Lee Professor
Professor, Health Policy
Professor Pediatrics (General Pediatrics)
jason_wang_profile_2019.jpg MD, PhD

C. Jason Wang, M.D., Ph.D. is a Professor of Pediatrics and Health Policy and director of the Center for Policy, Outcomes, and Prevention at Stanford University.  He received his B.S. from MIT, M.D. from Harvard, and Ph.D. in policy analysis from RAND.  After completing his pediatric residency training at UCSF, he worked in Greater China with McKinsey and Company, during which time he performed multiple studies in the Asian healthcare market. In 2000, he was recruited to serve as the project manager for the Taskforce on Reforming Taiwan's National Health Insurance System. His fellowship training in health services research included the Robert Wood Johnson Clinical Scholars Program and the National Research Service Award Fellowship at UCLA. Prior to coming to Stanford in 2011, he was an Assistant Professor of Pediatrics and Public Health (2006-2010) and Associate Professor (2010-2011) at Boston University and Boston Medical Center. 

Among his accomplishments, he was selected as the student speaker for Harvard Medical School Commencement (1996).  He received the Overseas Chinese Outstanding Achievement Medal (1996), the Robert Wood Johnson Physician Faculty Scholars Career Development Award (2007), the CIMIT Young Clinician Research Award for Transformative Innovation in Healthcare Research (2010), and the NIH Director’s New Innovator Award (2011). He was recently named a “Viewpoints” editor and a regular contributor for the Journal of the American Medical Association (JAMA).  He served as an external reviewer for the 2011 IOM Report “Child and Adolescent Health and Health Care Quality: Measuring What Matters” and as a reviewer for AHRQ study sections.

Dr. Wang has written two bestselling Chinese books published in Taiwan and co-authored an English book “Analysis of Healthcare Interventions that Change Patient Trajectories”.  His essay, "Time is Ripe for Increased U.S.-China Cooperation in Health," was selected as the first-place American essay in the 2003 A. Doak Barnett Memorial Essay Contest sponsored by the National Committee on United States-China Relations.

Currently he is the principal investigator on a number of quality improvement and quality assessment projects funded by the Robert Wood Johnson Foundation, the National Institutes of Health (USA), Health Resources and Services Administration (HRSA), and the Andrew T. Huang Medical Education Promotion Fund (Taiwan).

Dr. Wang’s research interests include: 1) developing tools for assessing and improving the quality of healthcare; 2) facilitating the use of innovative consumer technology in improving quality of care and health outcomes; 3) studying competency-based medical education curriculum, and 4) improving health systems performance.

Director, Center for Policy, Outcomes & Prevention (CPOP)
Co-Director, PCHA-UHA Research & Learning Collaborative
Co-Chair, Mobile Health & Other Technologies, Stanford Center for Population Health Sciences
Co-Director, Academic General Pediatrics Fellowship
C. Jason Wang Speaker
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Greater income inequality among places, not just people, reshapes the labor market in America and beyond. Driving the change: the innovation cluster.
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Dr. Moretti's book, The New Geography of Jobs, was described by Forbes magazine as “easily the most important read of 2012.”

Americans frequently debate why wages are growing for the college-educated but declining for those with less education. What is less well-known is that communities and local labor markets are also diverging economically at an accelerating rate.

A closer look at the 300-plus metropolitan areas of the United States shows that Americans with high school degrees who work in communities dominated by innovative industries actually make more, on average, than the college graduates working in communities dominated by manufacturing industries, according to research by University of California, Berkeley economist Enrico Moretti, the author of The New Geography of Jobs, a book that Forbes magazine called “easily the most important read of 2012.” In the San Jose metropolitan area, for example, a high school graduate averages $68,009, compared with the $65,411 that is average for a college graduate in Bakersfield, Calif.

Some places have always been more prosperous than others, but these differences have increased more rapidly over the last 30 years as the gross domestic product and patents for new technologies have concentrated in two to three dozen communities that Moretti identifies as “brain hubs” or “innovation clusters.”

In these clusters, highly specialized innovation workers, such as engineers and designers, generate about three times as many local jobs for service workers ― such as doctors, carpenters, and waitresses ― as do manufacturing workers, Moretti said recently when speaking at Stanford Graduate School of Business. Here are edited excerpts from Moretti’s answers to questions from the Stanford audience.

What causes clusters to emerge?

This is a very active area of research, but I think fundamentally, there are three major reasons why clustering takes place. One is the thick labor market effect. If you are in a very highly specialized position, you want to be in a labor market where there are a lot of employers looking for workers, and a lot of workers looking for employers. The match between employer and employee tends to be more productive, more creative and innovative in thicker labor markets.

It is the same thing for the vendors, the providers of intermediate services. Companies in the Silicon Valley will find very specialized IP lawyers, lab services, and shipping services that focus on that niche of the industry. And because they are so specialized, they're particularly good at what they're doing.

The third factor is what economists call human capital spillovers ― the fact that people learn from their colleagues, random encounters in a coffee shop, at a party, from their children, and so on. There's a lot of sociological evidence that this is one of the attractions of Silicon Valley. You're always near other people who are at the frontier, so you tend to exchange information. Sometimes it's information about job openings. Sometimes it’s information about what you're doing, what type of technology you're adopting, what type of research you are doing. And this, as you can imagine, is important for R&D, for innovation.

So these three forces are crucial, and that means that localities that already have a lot of innovation tend to attract even more workers and even more employers. That further strengthens their virtuous circle.

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Dr. Enrico Moretti leading a seminar organized by the Stanford Program on Regions of Innovation and Entrepreneurship (SPRIE) of the Stanford Graduate School of Business as part of its Silicon Valley Project.

Are these clusters sustainable forever?

Probably not. Previous clusters have collapsed in spectacular ways. The Silicon Valley of the 1950s was Detroit. People have researched the rise of Detroit, and it mimics very well the rise of Silicon Valley in terms of the amount of innovation, the type of engineering, the type of salaries they were paying. In the 1950s, if you were a car engineer, there wasn't any better place in the world to be, and if you were a car company, you had to be there. But then, of course, it collapsed.

In my book, I have a chapter on the difference between Detroit and Silicon Valley. This region has kept reinventing itself in ways that are remarkable. It was all orchards, and then it became all hardware, and then it became all software. And now it's becoming something else: social media and biotech and clean tech. Some types of clusters don't survive big negative shocks, and other clusters are able to leverage themselves into the next thing.

Is there a clean energy cluster that is structurally different from an internet or an IT or a biotech cluster? Or are they all intermingled?

Typically, clusters are very specialized. Silicon Valley is the exception in the sense that there are so many different technologies. More typical examples are Boise, Idaho, for radio technology or Portland, Oregon, for semiconductors. Seattle has a combination of software and now a growing body of life sciences. Boston is mostly life science. D.C. is a remarkable story. It's very diversified now in terms of private-sector innovation, but most clusters are going to be small pockets of one industry.

Does your argument hold for high-paid but non-high-tech sectors? I was thinking of New York being a financial sector or L.A. being entertainment, and Houston being oil and gas. Then you mentioned Washington, D.C. That's government.

I would argue that three you mentioned would belong to what I define as innovation sectors in the following sense: Finance in New York is not bank tellers; it’s people who invent new products, new technology, and new ways of making things. They are unique, and you can't easily reproduce the cluster somewhere else. That certainly applies to entertainment, especially the digital part of entertainment that is the fastest-growing part of entertainment jobs.

It also applies to the D.C. cluster. The growth of D.C. over the last 20 years is mostly driven by private-sector headquarters moving there, and an educated labor force. Some of the companies are military contractors. Some companies are life science. They're anchored by the National Institutes of Health being there, and other government agencies. But most of the growth actually comes from the private sector.

Now oil, Houston, I'm not sure. I don't know how strong these clustering forces are for these type of jobs. I would imagine ― and we're not talking about the guy who drills, but it's more like the guy who plans where to drill ― to the extent that there is a high component of innovation that makes something that is unique, I would say it applies.

If I'm a high-tech worker, how am I responsible for creating five other jobs? It’s hard for me to accept there are five.

The way to interpret the multiplier is to imagine dropping 1,000 innovation jobs in one city but not in another, and then going back 10 years later to measure how many additional local service jobs there are in the city that experienced that innovation-sector drop of jobs. So it's a long-run effect, but it’s not impossible for three reasons.

One is that the average high-tech worker tends to do very, very well, and people who are wealthy tend to spend a large fraction of their salary on personal and local services. They tend to go to restaurants and movies, and to use taxis and therapists and doctors on average more than people who are paid less.

The second reason is high-tech companies themselves employ a lot of local services; everything from security guards to IP lawyers, from the janitor to the very specialized consultant. High-tech companies tend to use more services than manufacturing companies.

The third reason is the clustering effect. Once you attract one of those high-tech workers, then in the medium to long run, you're going to be attracting even more of those high-tech workers and companies, which will further increase your multiplier. So it's a long-run number, measured over a 10-year period.

You pointed out that the salaries of the less-educated part of the local population are higher in those places that do have a lot of the innovation. How is that reconciled with the drastic drop over 30 years in their national average compensation?

We don't have enough brain hubs where innovation is concentrated. We have 320 metro areas in the U.S., and probably, by my definition, we have 15 to 20 brain hubs. In those places, you have brisk job creation outside the innovation sector, and you have decent wages for people outside. But we also have a big chunk of the country producing not very much, in part because manufacturing jobs have been shrinking, and innovation hasn't really taken place.

So what hope is there for these areas?

That's a million-dollar question. It's tough because, in some sense, if this clustering effect is particularly strong, it's good news for places like here, but it's terrible news for places like Flint or Detroit. A successful local labor market has a very nice equilibrium, where you have a lot of skilled workers who want to go there and a lot of innovative employers who want to go there. It's really hard to re-create somewhere else.

And it's not like we're not trying. We're spending $15 to $18 billion annually in what economists call place-based policies, which are essentially subsidies to try to attract employers to these areas. The idea being: “They're not coming, so if we just break this vicious circle, if we just bring some, then the clustering effect starts taking off. We can effectively create innovation hubs where they don't exist.”

I haven't found one example of an innovation hub in the U.S. that has been created by deliberate policy that says, "We're going to create an innovation hub here." Taiwan might be a good success story. It’s hard to get data, but Taiwan was an agricultural economy in the 1960s that had very little innovation. Then in the 1970s, it created enormous government subsidies for semiconductors and a lot of other technologies. All the others didn't pan out, but semiconductors worked. Taiwan is still putting money in, so it's not exactly clear whether it's a perfect example. Picking the next big thing is very hard for the venture capitalist. It's virtually impossible for the government worker.

What's the situation in other regions around the world ?

Obviously, India and China are major success stories, but that doesn't mean that this clustering effect is not at play within those countries. A different example is Italy, where I am from. Italy has been the Detroit in this story. It had a very strong pharmaceutical sector in the 1980s, and a smaller computer cluster. Once the pharmaceutical industry started becoming global, you saw mergers and a concentration of the industry’s R&D in a few places. I know because my dad was employed there, and his lab was first moved to Sweden and then to New Jersey.

I think the same is happening throughout many countries in continental Europe, and even in places like China and India, which have success stories but enormous regional differences. The innovative part of the Chinese economy is concentrated in a handful of megalopolises.

This is an interesting paradox of the current economy. Probably the best news of the last 20 years globally is the vast increase in the standard of living in places like China and India and Brazil, so there's certainly been a convergence in the standard of living when you compare nations. But when you look within those developing nations, you see the same great divergence that you see here.

Enrico Moretti Professor Enrico Moretti
Enrico Moretti is professor of economics at the University of California, Berkeley, where he holds the Michael Peevey and Donald Vial Career Development Chair in Labor Economics. He is also director of the Infrastructure and Urbanization Program at the International Growth Centre at the London School of Economics and Oxford University. His talk at Stanford was hosted by the Stanford Program on Regions of Innovation and Entrepreneurship, located in the Graduate School of Business.

 

Kathleen O'Toole is a journalist who frequently writes about social science. She is currently assistant editorial director of marketing and communications at the Stanford Graduate School of Business.

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Abstract: Taiwan (the Republic of China) has been changing with the times. So has its diplomacy. Having served his country for more than 40 years in various important diplomatic posts under different administrations, Ambassador Chen is one of Taiwan’s most seasoned diplomats. He joins us to share his personal experience and perspectives of Taiwan’s diplomacy. It is a historical review, but also an attempt to explore the future. Ambassador Chen believes that the diplomacy of Taiwan is unique because of its unique background. Although it should be defined by its own people, the country has been heavily influenced by the Chinese Mainland and the United States of America. How to promote Taiwan’s interests while preserving its identity and dignity, and conducting the balancing exercises in an asymmetric international environment has always been the crux of diplomacy in Taiwan. Ambassador Chen’s insights will allow us a better understanding of diplomacy in Taiwan, its successes and frustrations and presenting a possible roadmap for the future.

C.J. Chen is the former Minister of Foreign Affairs of the Republic of China (1999-2000). He has also served as Taiwan’s de facto Ambassador to the United States (2000-2004) and European Union (2004-2006). Having spent most of his career in the Foreign Ministry, Mr. Chen is regarded as one of Taiwan’s most accomplished diplomats and an expert on U.S./Taiwan relations. He was educated in Taiwan, Britain, Spain and the US, and has extensive experience representing his nation in the United States. He began his first tour of duty in Washington, D.C. in 1971 and was later a key member of the team that negotiated with the United States government for the future relations between Taiwan and the U.S. after the U.S. switched diplomatic ties from the Republic of China (ROC) to the People’s Republic of China) in 1979. Mr. Chen was heavily involved in communicating with the U.S. Congress during the implementation of the Taiwan Relations Act (TRA) which still serves as the back bone and framework for U.S./ Taiwan relations. In addition to Mr. Chen’s diplomatic experience, he was also selected by the Kuomintang (KMT), to be a member of the Legislative Yuan, where served under both the blue (KMT) and green (DPP) administrations.

CISAC Conference Room

Ambassador C.J. Chen Founder, Taipei Forum and Minister of Foreign Affairs, Republic of China (1999-2000) Speaker
Seminars
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