Box office sales are a function of movie release timings, but warding off competition is a different ball game altogether. If you have ever watched James Dean in the movie Rebel Without a Cause, you probably remember the famous scene in which Dean’s character Jim Stark plays a game of “chicken” against the […]
Holding Up an Airline
The peculiar problem of pilot scarcity in China might be resolved with simple economics. From 1968 to 1973 US commercial airliners were skyjacked nearly once a week disrupting the aviation system.[1] Increased security measures eventually reduced such events to a rarity; but in China there is a different kind of hold-up problem disrupting airlines and […]
The iPad Index: Comparing Apples and Oranges
Is the iPad Index a good way of comparing the purchasing power parity of different countries? CommSec, a unit of Australia’s Commonwealth Bank, recently issued its annual iPad Index. The index compares the price of an iPad across 46 different countries–specifically a 16-gigabyte iPad Retina with wifi. The bank began with an iPod Index in […]
Starbucks Prices in China: How Much For a Cup of Coffee?
CCTV’s recent report examining Starbucks prices in China has created a storm in a coffee cup. Are the concerns cited by CCTV valid? Much has been made of a CCTV report concerning the high price of a cup of Starbucks coffee in China. CCTV-13, one of China’s state-sponsored television stations, ran a report on October […]
Tackling Excess Capacity in Industry: The Race Not Yet Run
Should the government take on the task of reducing excess capacity in an industry or is that best left to market forces? Imagine you have to form a track team but you are not allowed to run any races to judge the speed of the prospective team members. China’s Ministry of Industry and Information Technology […]
“Beggar Thy (Hotel) Neighbor”: Some Hotels in China are Expanding at Any Cost
How opening new hotels in China could damage the entire industry In late May, InterContinental Hotels Group (IHG) celebrated the opening of the IHG Shanghai Ruijin hotel. However, IHG’s spirits were probably dampened a bit by the bad news it received a week earlier. It was ordered to pay RMB 150 million to real estate […]
What is the Price of a Good Education at Chinese Universities? It Depends on Your Interests
How will choosing your major affect the cost of your education? For students attending Chinese universities, price discrimination between majors is a costly concern. College applicants in the US often experience “sticker shock” when they discover the price of a university education. But one thing they do not have to worry about is how their […]
Giving Credit Where it is Due: A Key Innovation Incentive
John Lennon and Paul McCartney wrote almost 180 songs together between 1962 and 1969, most of them recorded by the Beatles. One of them, ‘Yesterday’, has been recorded by more artists than any other song according to the Guinness Book of World Records. Imagine if Lennon was given full credit for all of those songs […]
Invisible Hand Revealed: Mobile Apps that Move Cabs
In an earlier article I discussed how the regulation of Beijing’s taxi fares had taken taxis off the road. Recently there has been a spate of mobile applications (mobile apps) to address this problem: DiDiDaChe and YaoYaoZhaoChe in Beijing, KuaiDiDaChe in Hangzhou, and DiDi and KuaiDi in Shanghai and Guangzhou. Although varying slightly, these apps […]
Bamboo Property Rights
Why enforcing the contentious issue of individual property rights might actually be a good thing for China. Moganshan Mountain near Hangzhou in China’s Zhejiang Province is famous not only for striking scenery and white tea, but also for bamboo. Bamboo is an extremely versatile plant and over the centuries, the Chinese have grown it to […]
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