Globalization

BEIJING For the last 20 years, many American states have attempted to duplicate the success of Silicon Valley — they’ve tried Silicon Alleys, Praries, Swamps, Meadows, and Hills. It’s a worthy goal — emulating the innovation and entrepreneurship of SV — but most places won’t fully succeed. There’s a place on the other side of the world, however, that might someday come close. with John Rutledge (left) in Haidian, Beijing It’s the Haidian District of Beijing. With 80 universities — including the nation’s top two, Beijing U. and Tsinghua — 400,000 undergrads and 30,000 graduate students, all the big American and Chinese technology companies, from Microsoft, IBM, and AMD to Lenovo, Baidu, and Sohu, and with Special Economic Zone status, Read More ›

Nobel prize winner and China expert Robert Mundell continues to be optimistic about the Chinese economy but now also believes the U.S. has stepped down its intense pressure to appreciate the Chinese yuan. Good news all around. -Bret Swanson

Sebastian Mallaby’s argument today that we face a “Fake China Threat” contains a number of true and important observations but in its overall effect is, I think, wrong. Mallaby correctly observes: – The rise of Chinese science is positive-sum. – Science tends to spread across the world, yielding new innovations and economic growth wherever the science is embraced and allowed to transform into commercial success. – The U.S. has the world’s best universities and has a big lead. But Mallaby complacently writes that “the world’s top researchers flock here; provided enough visas are available, it’s hard to see why this would change.” First of all, it’s not automatic that we will indeed execute a sane visa policy. Second, with universities Read More ›

Proof that you can never have it both ways can be found in a report by Christopher Rhoads in today’s Wall Street Journal, which notes that countries and organizations are erecting rival Internets. Internet pioneers such as Vinton Cerf are alarmed about a fragmentation of the Internet, according to Rhoads. But we should step back and give thanks for what this development is not. It is not U.N. control of the Internet. The U.N. is a sclerotic, and some say corrupt, organization that is full of strange notions about the importance of personal and commercial freedom. Were it to control the Internet, foreign dictators and bureaucrats would be able to influence how we can use the Internet in this country. Read More ›

The Wall Street Journal Asia notes a new international poll (sub. req.) gauging sentiment on capitalism. In a poll conducted for the University of Maryland’s Program on International Policy Attitudes between June and August last year, fully 74% of Chinese citizens said they agreed with the statement “the free enterprise system and free market economy is the best system on which to base the future of the world.” The Philippines, at 73%, and the U.S., at 71%, were second and third. If you’ve been there recently, you know it’s true. -Bret Swanson

China recently published data from its “first economic census,” and the findings, as rough as they must be in a nation so large and dynamic, are interesting and encouraging, though I can’t say I’m surprised: 1) China’s economy in 2004 was almost 17 percent larger than previously thought, larger, in fact, than Italy’s, putting China in fifth place globally. Growth over the last 10 years was more like 10.5 percent than the previous estimate of 9.5 percent; 2) the service sector is far larger than previously thought, accounting for almost 41 percent of the economy, up from the previous estimate of 32 percent; 3) manufacturing accounts for 46.2 percent of the economy and agriculture for 13.1 percent, both lower than Read More ›

My friend Rich Karlgaard’s latest post at his Forbes Digital Rules blog reminded me of another major debate consuming the U.S. and China right now: energy. Karlgaard laments the disease of zero-sum thinking, which presumes one party’s gain is necessarily another party’s loss. Zero-sum thinking, more than anything else, is history’s chief culprit leading to war and depression. For some reason, it has infected untold generations of economists and politicians, and now it infects the debate over U.S.-China trade and the supposed world-wide race for the globe’s supposedly finite supply of energy. First the U.S. this summer blocked China CNOOC’s attempted acquisition of Unocal, an American company with mostly Asian petroleum assets, and now it seems that Beijing is resisting Read More ›

I spent last week in Beijing visiting with Nobel economist Robert Mundell, investor and all-around big thinker John Rutledge, other economists and scientists, and lots of everyday Chinese. It was an especially interesting time to be there right ahead of President Bush’s visit this week. -Bret Swanson

Microsoft’s work group server competitors claim they can’t keep up with the complexity of Microsoft’s product upgrades.

“We are, in many fields, ten years behind Microsoft. And the lag is growing with every new step Microsoft takes”

according to Volker Lendecke of the Samba Users Group, an organization dedicated to free software that anyone can copy.

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On the eve of a conference in Tunisia to discuss the management of Internet domain names, the U.N. Conference on Trade and Development has issued a 276-page report highlighting the existence of a digital divide between developed and developing countries. The report makes some useful observations about how Internet connections are over-regulated and over-taxed in many developing countries.

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