A common view of China’s central planning is that it has failed; since China grew faster when its reforms replaced planning with markets, the sooner China gets rid of Five Year Plans the better. This view is rather simplistic. Evidence shows that the Five Year Plans have played an important role in China’s progress. It was the fastest way for China to mobilize capital and labor for industrialization. And when China transitioned from a planned to a market economy and the two worked in parallel, it maintained employment, livelihoods, infrastructure and the supply of basic goods, hence a stable foundation for the nascent market economy.
Anil K. Gupta, the Michael Dingman Chair in Strategy, Globalization and Entrepreneurship at University of Maryland’s Smith School of Business, questions the logic behind Haier’s giant leap towards its new platform strategy. What’s at stake for Haier if it doesn’t embark upon this ambitious plan? According to Gupta: Haier now faces a major conundrum. Unless the company can find other growth opportunities fast, it faces years of potentially very slow growth. It is in this context that one can understand why CEO Zhang Ruimin has embarked on this new strategy.
It is a truth universally acknowledged that a Chinese state-owned enterprise (SOE) in possession of industrial assets must be in want of reform. China’s reforms have released many assets into private ownership, but large blocks remain in corporations linked either to the central government or to a local government via chains of corporate ownership. The State Council’s latest guidelines on the reform of state-linked enterprises envisage more private ownership, some mergers, and a greater role for state asset management companies. But would that ensure better corporate governance?
In a bid to improve the environment, the Chinese government is considering imposing a pollution tax. But how exactly should it determine the tax amount?
How to extract the maximum value from your big data initiatives without falling into the hidden traps.
When externalities are present, decisions optimal for the person making them are not necessarily optimal for society. So what can be done about them?
Alibaba’s investment in Suning is a signal that companies in retail in China need a multichannel strategy: embracing both the online as well as offline worlds.
PBOC’s move to devaluing the RMB didn’t just follow weak exports data, but also IMF requirements for more market-driven exchange rates.
Early indications show that the Chinese government’s efforts to prop up the economy might be able to steer clear of the risks of the 2009 economic stimulus
The government should step in and regulate digital monopolies because at the end of the day, healthy competition benefits all.