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Paul Romer is a Senior Fellow in the Stanford Center for International Development (SCID) and the Stanford Institute for Economic Policy Research (SIEPR). His contributions to the field of economics include being the primary developer of New Growth Theory, which reduces the traditional emphasis on the scarcity of objects and directs attention to the power of new ideas. His theory has brought renewed optimism about the potential for growth in both advanced and developing economies.

For his work on the economics of ideas, Paul was named one of America's 25 most influential people by TIME magazine (1997), elected a fellow of the American Academy of Arts and Sciences (2000) and awarded the Horst Claus Recktenwald Prize in Economics (2002). He is a Research Associate of the National Bureau of Economic Research and a Fellow of the Econometric Society. Prior to his current Stanford University position, he taught in the university's Graduate School of Business as the STANCO 25 Professor of Economics and was honored with the Distinguished Teaching Award (1999). Before moving to Stanford, Paul taught economics at the University of California at Berkeley, the University of Chicago and the University of Rochester. He received his PhD in economics from the University of Chicago.

In addition to his career in teaching and research, Paul founded Aplia, Inc., which is now part of Cengage Learning. Aplia, which develops and applies technologies to improve student learning, grew out of Paul's conviction that it is possible to use information technology to raise productivity in education. This lesson has important implications for how societies keep up with the growing demand for highly educated workers-a demand that is driven by the use of new technology in all other sectors of the economy.

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Paul Romer Senior Fellow Speaker Stanford Center for International Development (SCID) and Stanford Institute for Economic Policy Research (SIEPR)
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Rising leaders from some of the world’s most complex and challenging nations, including China, Russia, Ukraine, Iraq, Kenya, Nigeria, South Africa, and the Democratic Republic of the Congo, have just completed a three-week seminar at Stanford as Draper Hills Summer Fellows on Democracy and Development. This year’s extraordinary class of fellows included members of parliament, government advisors, civic activists, leading jurists, journalists, international development experts and founders of non-governmental organizations (NGOs).

Each year, several hundred applicants apply to FSI’s Center on Democracy, Development, and the Rule of Law (CDDRL), the convener of the program, for the 26-28 slots available to study and help foster linkages among democracy, economic development, human rights, and the rule of law. Now in its fifth year, the program has received generous gifts from William Draper III, a Silicon Valley entrepreneur, in honor of his father, Maj. Gen. William H. Draper, Jr., a chief advisor to Gen. George Marshall and chief diplomatic administrator of the Marshall Plan in Germany, and Ingrid von Mangoldt Hills, a former journalist, in honor of her husband, Reuben Hills, a leading San Francisco philanthropist and president and chairman of the board of Hills Bros. Coffee.

Draper Hills Summer Fellows are innovative, courageous, and committed leaders, who strive to improve governance, enhance civic participation, and invigorate development under very challenging circumstances," said CDDRL Director Larry Diamond. “This year’s fellows were absolutely extraordinary, learning from us we hope, but also teaching all of us about the progress they are making and the obstacles they confront in a diverse set of countries.  We were not only sobered by the difficulties they must address on a daily basis but also uplifted by their accounts of programs that are working to deepen democracy, improve government accountability, strengthen the rule of law, energize civil society, and enhance the institutional environment for broadly shared economic growth.”

The three-week seminar is taught by an all star faculty, which in addition to Diamond, includes CDDRL Deputy Director Kathryn Stoner, Stanford president emeritus and constitutional law expert Gerhard Casper, FSI Deputy Director and political science professor Stephen D. Krasner, Erik Jensen and Allen S. Weiner from the Stanford law school, Avner Greif from the Department of Economics, Peter Henry from the Graduate School of Business, FSI Senior Fellow Helen Stacy, former FSI Director and current Program on Food Security and the Environment deputy director Walter P. Falcon, Mark C. Thurber, acting director of FSI’s Program on Energy and Sustainable Development, and Nicholas Hope, director of the Stanford Center on International Development.

Other leading experts and practitioners who engaged the fellows included democracy and governance expert Francis Fukuyama, who joins CDDRL as Olivier Nomellini Senior Fellow in July 2010, National Endowment for Democracy President Carl Gershman, United States Court of Appeals Judge Pamela Rymer, International Center on Nonviolent Conflict founding chair Peter Ackerman, the center’s president, Jack DuVall, former Peruvian president Alejandro Toledo, and former Secretaries of State George Shultz and Condoleezza Rice.

Faculty devoted the first week of the seminar to defining the fundamentals of democracy, good governance, economic development, and the rule of law, and in the second week turned to the issue of transitions and the feedback mechanisms between democracy, development, and a predictable rule of law. The third week examined the critical – and often controversial – role of international assistance to foster and support democracy, judicial reform, and economic development, including the proper role of foreign aid.

Against this backdrop, fellows emphasized domestic imperatives for fostering growth, social inclusion, and transformation, centering on the importance of political will and sound institutions.  In session after session, they wrestled with the concrete and all too common impediments to progress—from corruption, cronyism, and authoritarian regimes, to the fragility of conflict-ridden, multi-ethnic polities.  As an activist from strife-torn Iraq said, “Democracy is not just a way of governing. It is a way of living, a way of thinking about life.”“Democracy is not just a way of governing. It is a way of living, a way of thinking about life”

In spirited debates, in the formal seminar sessions and beyond the classroom to the Munger residence where the fellows stayed, the fellows stressed how they had all taught and learned from each other.  A rising leader from South Africa aptly summarized, “We have dispelled each other’s myths.”

As the Draper Hills Fellows expressed their profound gratitude to their faculty and mentors, they reinforced the importance of staying in touch through a virtual online community – a “common space” as defined by a member of parliament from Ukraine, that would let them look forward and look back, perhaps a decade from now, at case studies of success and failure, and the all important roles that political will and leadership played in determining outcomes.  “Stay tuned,” said Diamond and Stoner-Weiss. “Important lessons are still to come.”

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This dialogue will bring together distinguished experts from Stanford and Silicon Valley, top specialists from around the region, and leaders in various fields such as business, politics, academia, and media.  We will begin with an exploration of the influence of energy competition on international relations in Asia.  After establishing the geopolitical context the group will explore new ideas on how to promote energy efficiency, clean technology, and the reduction of carbon emissions.

Experts will look closely at the Japanese experience in the development and dissemination of energy efficient and pollution-control technologies, critical elements of meeting growing demands for energy without causing greater harm to the environment.  We will discuss how the United States, under the new Obama administration, may contribute more to the reduction of carbon emissions and the advance of alternative energy technologies.  And we will analyze how the growing energy consumers in developing Asia can join a post-Kyoto Protocol that effectively mitigates the environmental impact of energy use and reduces the tensions arising from competition for energy resources.

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FSI benefactor Ronald P. Spogli, former U.S. ambassador to Italy and San Marino (2005-09), has been elected by the Stanford University Board of Trustees to a five-year term beginning in October 2009. Spogli will take his seat at the next meeting, scheduled for Oct. 12-13. Spogli has had a highly distinguished career in business as well as public service as a founding partner of Freeman Spogli & Co, a private equity investment firm he established in 1983 with fellow Stanford alumnus Bradford M. Freeman. Both Freeman and Spogli have offered exemplary leadership to Stanford in many capacities. Freeman served on the Stanford Board of Trustees from 1995 to 2005 and both Freeman and Spogli currently serve on the FSI Advisory Board.

The Stanford University Board of Trustees recently elected Ronald P. Spogli, former U.S. ambassador to Italy and San Marino, to a five-year term beginning in October.

The board, which last met in June, used electronic ballots to conduct the election, which took place in July. Spogli will take his seat at the next meeting, scheduled for Oct. 12-13.

Including Spogli, the board will have 31 members, four fewer than its limit of 35.

"Ron Spogli has a long track record of commitment to and support for Stanford, and we are fortunate to have him join the board," said Leslie Hume, chair of the Board of Trustees. "With a distinguished career in both business and in public service, he brings a global perspective to the board that will serve the university well."

Spogli, who was nominated by former President George W. Bush as U.S. ambassador to Italy, was sworn in as ambassador in August 2005. In 2006, Spogli also became the American ambassador to San Marino—the first person to hold the title in the small mountainous country, which is completely surrounded by Italy. Both terms ended last February.

Spogli is a founding partner of Freeman Spogli & Co., a private equity investment firm he established in 1983 with Bradford M. Freeman in Los Angeles. In 2005, the longtime business partners and friends donated $50 million to Stanford's International Initiative. The initiative was launched to promote collaboration on campus on three themes: pursuing peace and security; improving governance locally, nationally and internationally; and advancing human well-being.

In recognition of their generous gift, the university changed the name of the Stanford Institute for International Studies to the Freeman Spogli Institute for International Studies. Currently, Spogli is a member of the institute's advisory board.

When he became an ambassador in 2005, Spogli was required to sever all ties with Freeman Spogli & Co. He rejoined the firm in June 2009.

Spogli, who was born in Los Angeles in 1948, earned a bachelor's degree in history from Stanford in 1970. During his junior year, Spogli was elected to the Phi Beta Kappa Society, the nation's oldest academic honor society.

As an undergraduate, Spogli traveled to Italy to study at Stanford's Florence campus. After graduating, he spent a year working as an assistant to the directors of the Florence program. Later, he spent more than a year living in Milan, where he was the lead researcher for a project studying the social impact of labor migration from southern Italy to the Italian industrial north.

In 1975, Spogli earned an MBA from Harvard Business School.

In 2002, President Bush appointed Spogli to a three-year term with the J. William Fulbright Foreign Scholarship Board, which establishes worldwide policies and procedures for the Fulbright Program and issues an annual report.

From 2002 to 2005, Spogli also served on the Overseas Studies Program Council, an advisory panel to what is now known as Stanford's Bing Overseas Studies Program.

Spogli has endowed two positions at Stanford: The Gesue and Helen Spogli Professorship in Italian Studies, which was named in honor of his Italian immigrant grandfather, who arrived in America in 1912, settled in Pennsylvania and moved to California in 1941, and his mother; and The Spogli Family Overseas Studies Director position in Florence, Italy.

Spogli served as regional chair of the major gifts committee of the Campaign for Undergraduate Education from 2000 to 2004. The campaign, which ended in 2005, raised more than $1 billion.

Spogli also has served as an active volunteer at many Stanford events. He served as co-chair of the "Think Again" event in Los Angeles and as a member of the steering committee for the "Think Again" event in San Diego. The 12-city tour – a component of the Campaign for Undergraduate Education – was designed to reacquaint alumni with the university and the strides it had made in undergraduate education over the past decade. He also served as co-chair of the Special Gifts Committee for his 35th class reunion.

 

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Ting Ting is currently at Beijing Technology and Business University where she teaches International Trade and Business Communication.  Prior to that, she worked at Siemens Ltd. China and Lenovo Computer Systems with expereince in international business.  She obtained her Master's Degree of Science in Finance from the University of Liverpool (UK, 2003) and her Bachelor of Economics from Southwestern University of Finance & Economics (China, 1988).

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2011 AHPP/CEAS Visiting Scholar
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Dr. Brian Chen is currently a visiting scholar with the Asia Health Policy Program and Center for East Asian Studies at Stanford University. He was recently Shorenstein Asia-Pacific Research Center's 2009-2010 postdoctoral fellow in Comparative Health Policy. As a visiting scholar, Dr. Chen will conduct collaborative research about health of the elderly and chronic disease in China.

As an applied economist, Chen’s research focuses on the impact of incentives in health care organizations on provider and patient behavior. For his dissertation, Chen empirically examined how vertical integration and prohibition against self-referrals affected physician prescribing behavior. His job market paper was selected for presentation at the American Law and Economics Association’s Annual Meeting, the Academy of Management, the Canadian Law and Economics Association, the Conference on Empirical Legal Studies, and the First Annual Conference on Empirical Health Law and Policy at Georgetown Law Center in 2009.  The paper was also nominated for best paper based on a dissertation at the Academy of Management.

Chen comes to the Shorenstein Asia-Pacific Research Center not only with a multidisciplinary law and economics background, but also with an international perspective from having lived and worked in Taiwan, Japan, and France. He has a particularly intimate knowledge of the Taiwanese health care system from his experience as an assistant to the hospital administrator at a medical college in Taiwan.

During his past residence as a postdoctoral fellow with the Asia Health Policy Program, Chen conducted empirical research on cost containment policies in Taiwan and Japan and how those policies impacted provider behavior. His work also contributed to the program’s research activities on comparative health systems and health service delivery in the Asia-Pacific, a theme that encompasses the historical evolution of health policies; the role of the private sector and public-private partnerships; payment incentives and their impact on patients and providers; organizational innovation, contracting, and soft budget constraints; and chronic disease management and service coordination for aging populations.

Dr. Brian Chen recently completed his Ph.D. in Business Administration in the Business and Public Policy Group at the Haas School of Business, University of California at Berkeley. He received a Juris Doctor from Stanford Law School in 1997, and graduated summa cum laude from Harvard College in 1992.

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Currently Dr. Kaarboe is working as an associate professor in economics at Department of Economics, University of Bergen, Norway. He also serves as the research director of the research group Health Economics Bergen (HEB).

Dr. Kaarboe's research has mainly been focused on developing and implementing financing models in the health care sector. This includes i) theoretical work, ii) developing remuneration models at the nation level, and iii) developing and implementing remuneration models at the regional level in Norway. He has also been involved in a WHO-project on implementing decentralization in health care. Recently Dr. Kaarboe was the Principal Investigator (PI) for a project on evaluation of a Norwegian hospital reform. This reform concerns a major change in the governance structure of the hospital sector in Norway. Currently Dr. Kaarboe is the PI of a project on prioritization in the hospital sector. The main purpose of the project is to develop a surveillance system to monitor prioritization of hospital patients. One part of the project includes a comparative analysis of prioritization practices in Norway and Scotland. He is also involved in a project about the relationship between social capital and health.

The health economics group in Bergen is one of the larger health research groups in Europe. The research group is based within economics and business administration but emphasizes multidisciplinary research cooperation with medicine, health care institutions and other social sciences. It has a broad international (European) network. Well known health economics like Professors Andrew Jones, (York), Carol Propper (Imperial College/Bristol University), John Cairns (London School of Hygiene and Tropical Medicine), Matt Sutton (University of Manchester), Sherman Folland (Oakland University) and Maarten Lindeboom (Vrije University) are all affiliated with the health group.

Adjunct Affiliate at the Center for Health Policy and the Department of Health Policy
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Now available on the SPRIE website: the audio recording of Professor Charla Griffy-Brown's seminar on "The Fortress and the Cloud: Women, technology and entrepreneurship in Japan." Professor Griffy-Brown explores how new business models are developing in Japan and how opportunities are being created for the rise of women entrepreneurs.
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Project development is particularly challenging in “frontier” environments where alternative technologies, conflicting laws and agencies, and uncertain benefits or risks constrain the knowledge or decisions of participants.  Carbon capture and storage (“CCS”) projects by means of geologic sequestration are pursued in such an environment.  In these circumstances, entrepreneurs can seek to employ two distinct types of tools:  the game-changer, being an improvement to the status quo for all those similarly situated, generally achieved through collective or governmental action; and the finesse, being an individualized pursuit of an extraordinary project that is minimally affected by a given legal, business or technological obstacle.  These techniques are illustrated in the case of CCS as to ownership of property rights, carbon dioxide (“CO2”) transportation economics, liability for stored CO2 following the closure of injection wells, inter-agency and federal-state conflicts, competing technologies, and uncertain economic or legal incentives.  The finesse and the game-changer should also be useful concepts for creative solutions in other applications.

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Program on Energy and Sustainable Development, Working Paper #87
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Donald K. Emmerson
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Jim Castle is a friend of mine. I have known him since we were graduate students in Indonesia in the late 1960s. While I labored in academe he went on to found and grow CastleAsia into what is arguably the most highly regarded private-sector consultancy for informing and interfacing expatriate and domestic investors and managers in Indonesia. Friday mornings he hosts a breakfast gathering of business executives at his favorite hotel, the JW Marriott in the Kuningan district of Jakarta.

Or he did, until the morning of July 17, 2009. On that Friday, shortly before 8am, a man pulling a suitcase on wheels strolled into the Marriott's Lobby Lounge, where Jim and his colleagues were meeting, and detonated the contents of his luggage. We know that the bomber was at least outwardly calm from the surveillance videotape of his relaxed walk across the lobby to the restaurant.

He wore a business suit, presumably to deflect attention before he blew himself up. Almost simultaneously, in the Airlangga restaurant at the Ritz Carlton hotel across the street, a confederate destroyed himself, killing or wounding a second set of victims. As of this writing, the toll stands at nine dead (including the killers) and more than 50 injured.

On learning that Jim had been at the meeting in the Marriott, I became frantic to find out if he were still alive. A mere 16 hours later, to my immense relief, he answered my e-mail. He was out of hospital, having sustained what he called "trivial injuries", including a temporary loss of hearing. Of the nearly 20 people at the roundtable meeting, however, four died and others were badly hurt. Jim's number two at CastleAsia lost part of a leg.

The same Marriott had been bombed before, in 2003. That explosion killed 12 people. Eight of them were Indonesian citizens, who also made up the great majority of the roughly 150 people wounded in that attack - and most of these Indonesian victims were Muslims. This distribution undercut the claim of the country's small jihadi fringe to be defending Islam's local adherents against foreign infidels.

But if last Friday's killers hoped to gain the sympathy of Indonesians this time around by attacking Jim and his expatriate colleagues and thereby lowering the proportion of domestic casualties, they failed. Of the 37 victims whose names and nationalities were known as of Monday, 60% were Indonesians, and that figure was almost certain to rise as more bodies were identified. The selective public acceptance of slaughter to which the targeting of infidel foreigners might have catered is, of course, grotesquely inhumane.

Since Susilo Bambang Yudhoyono was first elected president in 2004, Indonesia's real gross domestic product has averaged around 6% annual growth. In 2008 only four of East Asia's 19 economies achieved rates higher than Indonesia's 6.1% (Vietnam, Mongolia, China and Macau). In the first quarter of 2009, measured year-on-year, while the recession-hit economies of Malaysia, Singapore and Thailand all shrank, Indonesia's grew 4.4%. In the first half of 2009, the Jakarta Stock Exchange soared.

The economy is hardly all roses. Poverty and corruption remain pervasive. Unemployment and underemployment persist. The country's infrastructure badly needs repair. And the economy's performance in attracting foreign direct investment (FDI) has been sub-par: The US$2 billion in FDI that went to Indonesia in 2008 was less than a third of the $7 billion inflow enjoyed by Thailand's far smaller economy, notwithstanding Indonesia's far more stable politics.

Nevertheless, all things considered, the macro-economy in Yudhoyono's first term did reasonably well. We may never know whether the killer at the Marriott aimed to maximize economic harm. According to another expat consultant in Jakarta, Kevin O'Rourke, the day's victims included 10 of the top 50 business leaders in the city. "It could have been a coincidence," he said, or the bombers could have "known just what they were doing".

Imputing rationality to savagery is tricky business. But the attackers probably did hope to damage the Indonesian economy, notably foreign tourism and investment. In that context, the American provenance and patronage of the two hotels would have heightened their appeal as targets. Although the terrorists may not have known these details, the Ritz-Carlton Hotel Company is an independently operated division of Marriott International, Inc, which owns the JW Marriott brand, and both firms are headquartered on the outskirts of Washington DC.

Second-round revenge against the Marriott may also have played a role - assaulting a place that had rebuilt and recovered so quickly after being attacked in 2003. Spiteful retribution may have influenced the decision to re-attack the Kuta tourist area in Bali in 2005 after that neighborhood's recovery from the bomb carnage of 2002. Arguable, too, is the notion that 9/11 in 2001 was meant to finish the job started with the first bombing of the Twin Towers in 1993. And in all of these instances, the economy - Indonesian or American - suffered the consequences.

Panic buttons are not being pushed, however. Indonesian stock analyst Haryajid Ramelan's expectation seems plausible: that confidence in the economy will return if those who plotted the blasts are soon found and punished, and if investors can be convinced that these were "purely terrorist attacks" unrelated to domestic politics.

Sympathy for terrorism in Indonesia is far too sparse for Friday's explosions to destabilize the country. But they occurred merely nine days after Yudhoyono's landslide re-election as president on July 8, with three months still to go before the anticipated inauguration of his new administration on October 20. That timing ensured that some would speculate that the killers wanted to deprive the president of his second five-year term.

The president himself fed this speculation at his press conference on July 18, the day after the attacks. He brandished photographs of unnamed shooters with handguns using his picture for target practice. He reported the discovery of a plan to seize the headquarters of the election commission and thereby prevent his democratic victory from being announced. "There was a statement that there would be a revolution if SBY wins," he said, referring to himself by his initials.

"This is an intelligence report," he continued, "not rumors, nor gossip. Other statements said they wished to turn Indonesia into [a country like] Iran. And the last statement said that no matter what, SBY should not and would not be inaugurated." Barring information to the contrary, one may assume that these reports of threats were real, whether or not the threats themselves were. But why share them with the public?

Perhaps the president was defending his decision not to inspect the bomb damage in person - a gesture that would have shown sympathy for the victims while reassuring the population. He had wanted to go, he said, "But the chief of police and others suggested I should wait, since the area was not yet secure. And danger could come at any time, especially with all of the threats I have shown you. Physical threats."

Had Yudhoyono lost the election, or had he won it by only a thin and hotly contested margin, his remarks might have been read as an effort to garner sympathy and deflect attention from his unpopularity. The presidential candidates who lost to his landslide, Megawati Sukarnoputri and Jusuf Kalla, have indeed criticized how the July 8 polling was handled. And there were shortcomings. But even without them, Yudhoyono would still have won. In this context, speaking as he did from a position of personal popularity and political strength, the net effect of his comments was probably to encourage public support for stopping terrorism.

One may also note the calculated vagueness of his references to those - "they” - who wished him and the country harm. Not once in his speech did he refer to Jemaah Islamiyah, the network that is the culprit of choice for most analysts of the twin hotel attacks. Had he directly fingered that violently jihadi group, ambitious Islamist politicians such as Din Syamsuddin - head of Muhammadiyah, the country's second-largest Muslim organization - would have charged him with defaming Islam because Jemaah Islamiyah literally means "the Islamic group" or "the Islamic community".

One may hope that Din's ability to turn his Islamist supporters against jihadi terrorism and in favor of religious freedom and liberal democracy will someday catch up to his energy in policing language. Yet Yudhoyono was right not to mention Jemaah Islamiyah. Doing so would have complicated unnecessarily the president's relations with Muslim politicians whose support he may need when it comes to getting the legislature to turn his proposals into laws. Nor is it even clear that Jemaah Islamiyah is still an entity coherent enough to have, in fact, masterminded last Friday's attacks.

Peering into the future, one may reasonably conclude that the bombings' repercussions will neither annul Yudhoyono's landslide victory nor derail the inauguration of his next administration. Nor will they do more than temporary damage to the Indonesian economy. As for the personal aspect of what happened Friday, while mourning the dead, I am grateful that Jim and others, foreign and Indonesian, are still alive.

Donald K Emmerson heads the Southeast Asia Forum at Stanford University. He is a co-author of Islamism: Contested Perspectives on Political Islam (Stanford University Press, November 2009) and Hard Choices: Security, Democracy, and Regionalism in Southeast Asia (Stanford/ISEAS, 2008).

Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved.

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