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Planning in Transition Economies for Growth and Equity

Graduate · Historical course

Summer 2004 · Beijing Urban Design Studio

The Beijing Urban Design Studio is a joint program between the MIT and Tsinghua University Schools of Architecture and Planning. The goal of the studio is to foster international cooperation through the undertaking of a joint urban design and planning initiative in the city of Beijing involving important, often controversial, sites and projects. Since 1995, almost 250 MIT and Tsinghua University students and faculty have participated in this annual studio, making it one of the most successful and enduring international academic programs between China and the US. It has received the Irwin Sizer Award from MIT for outstanding innovation in education. The studio takes place over five weeks in June and July including several weeks in residence at Tsinghua University and two brief study tours to locations and projects that inform the work. It will include 18-20 MIT and 10-15 Tsinghua Architecture and Planning students. The Beijing City Planning Institute, responsible for strategic planning in the city, participates in the studio as the client.

Spring 2004

Topics

  • The Importance of Institutions
  • The Rule of Law and Property Rights in Transition
  • Liberalization and Privatization
  • Asian versus European Transition?
  • A Rising Tide? The Growth of Inequality in Transition
  • The Emergence of the Private Firm
  • Relations with Local Government
  • Are Foreign firms privileged by their host governments?
  • The Shape of Transition: Cities under Transition
  • The Emergence of Entrepreneurs
  • Bringing it all together

Readings

  • Kornai, Janos. “What the Change of System from Socialism to Capitalism Does and Does not Mean.” Journal of Economic Perspectives 14, no. 1 (2002): 27-42.
    Listed reading
  • “Transition: the First Ten Years: Analysis and Lessons for Eastern Europe and the Former Soviet Union.” Washington DC: World Bank, 2002. ( PDF ) ↗
    Listed reading
  • Naughton, Barry. Growing Out of the Plan: Chinese Economic Reform 1978-1993. Cambridge, UK: Cambridge University Press, 1995. ISBN: 0521470552.
    Listed reading
  • Public Broadcasting Service. “ Frontline: China in the Red .” 1999. ↗
    Listed reading
  • Coase, R. H. “The Institutional Structure of Production.” American Economic Review 82 (September 1992): 713-719.
    Listed reading
  • Furubotn, Eirik, and Rudolf Richter. “The New Institutional Economics: an Assessment.” In The New Institutional Economics . Edited by Furubotn, and Richter. Ann Arbor, MI: University of Michigan Press, 1998. ISBN: 0472108174.
    Listed reading
  • Granovetter, Mark. “Economic Action and Social Structure: The Problem of Embeddedness.” The American Journal of Sociology 91 (November 1985): 481-510.
    Listed reading
  • ———. “A Theoretical Agenda for Economic Sociology.” In The New Economic Sociology: Developments in an Emerging Field . Edited by M. F. Guillen, Randall Collins, Paula England, and Marshall Meyer. New York: Russell Sage Foundation, 2002. ISBN: 0871543435.
    Listed reading
  • North, Douglass. “Institutions.” Journal of Economics Perspectives 5 (1991): 97-112.
    Listed reading
  • Buy at MIT Press Roland, Gerard. Transition and Economics: Politics, Markets, and Firms . Cambridge, MA: MIT Press, 2000. ISBN: 9780262182034. ↗
    Listed reading
  • Chow, Gregory C. “Challenges of China’s Economic System for Economic Theory.” American Economic Review 87, no. 2 (1997): 321-327.
    Listed reading
  • Demsetz, Harold. “Toward a Theory of Property Rights.” American Economic Review 57 (May 1967): 347-359.
    Listed reading
  • Gillespie, John. “Law and Development in ‘The Market Place’: An East Asian Perspective.” In Law, Capitalism, and Power in Asia . Edited by K. Jayasuriya. New York: Routledge, 1999. ISBN: 0415197430.
    Listed reading
  • Lo, Vai Io, and Xiaowen Tian. “Property Rights, Productivity Gains, and Economic Growth: The Chinese Experience.” Post-Communist Economies 14, no. 2 (2002): 245-258.
    Listed reading
  • Posner, Richard A. “Social Norms and the Law: An Economic Approach.” American Economic Review 87, no. 2 (1997): 365-369.
    Listed reading
  • Recommended Readings
    Listed reading
  • Johnson, Simon, John McMillan, and Christopher Woodruff. “Entrepreneurs and the Ordering of Institutional Reform.” Economics of Transition 8, no. 1 (2000): 1-36.
    Listed reading
  • Bilsen, Valentijn, and Jozef Konings. “Job Creation, Job Destruction, and Growth of Newly Established, Privatized and State-owned Enterprises in Transition Economies: Survey Evidence from Bulgaria, Hungary, and Romania.” Journal of Comparative Economics 26, no. 3 (1998): 429-445.
    Listed reading
  • Le, Wei. “The Impact of Economic Reform on the Performance of Chinese State Enterprises, 1980-1989.” Journal of Political Economy 105, no. 5 (1997): 1080-106.
    Listed reading
  • Megginson, William L., and Jeffry M. Netter. “From State to Market: A Survey of Empirical Studies on Privatization.” Journal of Economic Literature 39, no. 2 (2001): 321-389.
    Listed reading
  • Shirley, Mary M., and Xu Lixin Colin. “Information, Incentives, and Commitment: An Empirical Analysis of Contracts between Government and State Enterprises.” Journal of Law, Economics, and Organization 14, no. 2 (1998): 358-378.
    Listed reading
  • Groves, Theodore, Yongmiao Hong, John McMillan, and Barry Naughton. “China’s Evolving Managerial Labor Market.” The Journal of Political Economy 103, no. 4 (1995): 873-892.
    Listed reading
  • Brezis, Elise S., and Adi Schnytzer.“Why are the Transition Paths in China and Eastern Europe Different?” Economics of Transition 11, no. 1 (2003): 3-23.
    Listed reading
  • Frye, Timothy, and Andrei Shleifer. “The Invisible Hand and the Grabbing Hand.” American Economic Review 87, no. 2 (1997): 354-358.
    Listed reading
  • Roberts, Ken, and Changcheng Zhou. “New Private Enterprises in Three Transitional Contexts: Central Europe, the Former Soviet Union, and China.” Post-Communist Economies 12, no. 2 (2000): 187-199.
    Listed reading
  • Woo, Wing Thye. “The Art of Reforming Centrally Planned Economies: Comparing China, Poland, and Russia.” Journal of Comparative Economics 18, no. 3 (1994): 276-308.
    Listed reading
  • Brainerd, Elizabeth. “Winners and Loser in Russia’s Economic Transition.” American Economic Review 88, no. 5 (1998): 1094-1116.
    Listed reading
  • Keane, Michael P., and Eswar S. Prasad. “Poland: Inequality, Transfers, and Growth in Transition.” Finance and Development 38, no. 1 (2001).
    Listed reading
  • Kornai, Janos. “The Reform of the Welfare State and Public Opinion.” American Economic Review 87, no. 2 (1997): 339-343.
    Listed reading
  • Sibley, Christopher W., and Patrick Paul Walsh. “Earnings Inequality and Transition: A Regional Analysis of Poland.” IZA Discussion Papers 441. Bonn: Institute for the Study of Labor, 2002. ( PDF ) ↗
    Listed reading
  • Ham, John, Jan Svejnar, and Katherine Terrell. “Women’s Unemployment During the Transition: Evidence from Czech and Slovak Micro Data.” Economics of Transition 7, no. 1 (1999): 47-78.
    Listed reading
  • Wyzan, Michael. “Increase Inequality, Poverty Accompany Economic Transition.” Transition 2, no. 20 (1996).
    Listed reading
  • Hall, Peter A., and David Soskice. “An Introduction to Varieties of Capitalism.” Chapter 1 in Varieties of Capitalism . Oxford: Oxford University Press, 2002. ISBN: 0199247757.
    Listed reading
  • McMillan, John, and Christopher Woodruff. “Interfirm Relationships and Informal Credit in Vietnam.” The Quarterly Journal of Economics (1999): 1285-1320.
    Listed reading
  • Woodruff, Chirstopher. “The Central Role of Entrepreneurs in Transition Economies.” Journal of Economic Perspectives 16, no. 3 (2002): 153-170.
    Listed reading
  • Gel’man, Vladimir. “In Search of Local Autonomy: The Politics of Big Cities in Russia’s Transition.” International Journal of Urban and Regional Research 27, no. 1 (2003): 48-61.
    Listed reading
  • Johnson, Simon, Daniel Kaufmann, John McMillan, and Christopher Woodruff. “Why Do Firms Hide? Bribes and Unofficial Activity after Communism.” Journal of Public Economics 76 (2000): 495-520.
    Listed reading
  • Torgler, Benno. “Tax Morale in Transition Countries.” Post-Communist Economies 15, no. 3 (2003): 357-381.
    Listed reading
  • Fforde, Adam, and Stefan de Vylder. From Plan to Market: The Economic Transition in Vietnam. Boulder, CO: Westview Press, 1996. (Introduction)
    Listed reading
  • Gillespie, John. “Institutional Reform: Controlling Discretion in State Economic Regulation.” In Commercial Legal Development in Vietnam: Vietnamese and Foreign Commentaries . Edited by J. Gillespie. Hong Kong: Butterworths Asia, 1997.
    Listed reading
  • WEEK #: 9 · TOPICS: The Role of Foreign Investment in Transition · READINGS: Huang, Yasheng, and Wenhua Di. “ A Tale of Two Provinces: The Institutional Environment and Foreign Ownership in China .” MIT Sloan Working Paper No. 4482-04; William Davidson Institute Working Paper No. 667, 2004. ↗
    Reading assignment
  • Bertaud, Alain, and Bertrand Renaud. “Cities without Land Markets: Location and Land Use in the Socialist City.” World Bank Policy Working Paper No. 1477, 1995.
    Listed reading
  • Scarpaci, Joseph L. “On the Transformation of Socialist Cities.” Urban Geography 21, no. 8 (2000): 659-669.
    Listed reading
  • UNECE. “Human Settlement Developments in the Transition Economies of Central and Eastern Europe.” Geneva: United Nations-ECE, 1997.
    Listed reading
  • Zhu, Jieming. “Urban Development under Ambiguous Property Rights: A Case of China’s Transition Economy.” International Journal of Urban and Regional Research 26, no. 1 (2002): 41-57.
    Listed reading
  • Berkowitz, Daniel, and David N. DeJong. “Entrepreneurship and Post-Socialist Growth.” William Davidson Institute Working Paper No. 406, 2002.
    Listed reading
  • Earle, John, and Zuzana Sakova. “Entrepreneurship from Scratch: Lessons on the Entry Decision into Self- Employment.” Transition Economies IZA Discussion Paper Series IZA DP no. 79, 1999.
    Listed reading
  • ———. “Business Start-ups or Disguised Unemployment? Evidence on the Character of Self-Employment from Transition Countries.” Labor Economics 7, no. 5 (2000): 575-601.
    Listed reading
  • WEEK #: 12 · TOPICS: Bringing it all together · READINGS: Kim, Annette. “A Market with the “Right” Property Rights: The Newly Emerged Private Real Estate Market in Ho Chi Minh City, Vietnam.” Economics of Transition 12, no. 2 (2004).
    Reading assignment
Sources