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Weiying: Understanding and defend the market economy
2007-12-23 10:58:29 Source: China Economic Net User Review 197 Click to view
Historically, the market economy, so who would benefit most? Are you rich? No, the
biggest beneficiaries of market economy, ordinary people, not the privileged.
Analysis: Weiying famous economist, president of Peking University's
Guanghua School of Management
China has established a market economy is not easy. We totally deny the planned
economy period from the market, to the reform and opening up part of the recognition
of the market, to the South in 1992 ... ... after speaking to fully recognize the market,
after the efforts of several generations. Now, the community began to spread with the
market economy, misunderstanding and mistrust. This misunderstanding and distrust,
if evolution is more anti-market policies, China's economic development
will face a very big risk, than the more serious the consequences of environmental
damage. This time, economists need to come out, clarify and defend the market
From a historical look at the miracle of the market economy
Talk about market economy, contribution to mankind, we should review history.
Delong, according to UC Berkeley research economist, in human history, from the
Paleolithic Age to the year 2000 of 250 million years, humans have spent 99.4% of
the time, that is, to 15,000 years ago, the world's per capita GDP was 90
international dollars (which is approved in accordance with the purchasing power in
1990, a wealth of international unit of measurement). Then, it spent 0.59% of the time,
by the year 1750, world GDP per capita doubled, reaching 180 international dollars.
Starting from 1750 to 2000, that is 0.01% of the time, the world's per
capita GDP increased 37-fold, to 6600 international dollars. In other words, 97% of
the wealth of mankind, in the last 250 years Is 0.01% of the time created.
If the research painted Delong map coordinates, you can see, from 250 million years
ago now, in 99.99% of the time, the world's per capita GDP of basic no
change, but in the past 250 years, suddenly had an almost is the vertical growth. The
world's major developed countries as well, whether the so-called Western
Europe Yansheng Guo, such as the United States, Canada, Australia, or Western
European countries themselves, including Britain, France, Germany, 12 countries or
the emerging Japanese economic growth are major occurred in the past twelve
hundred years. China's economic growth has occurred in the past 30 years.
Alone can not explain all the problems digital. Imagine our ancestors, that is, 100
years ago, ordinary Chinese people, to consumption of things, and how much did the
ancient distinction between the Qin and Han Sui and Tang dynasties, or even not as
good as the Song Dynasty. In Europe too, in 1800 the average British consumption of
things when the Roman people can enjoy, even the Romans than they enjoy more. The
energy consumption of the things we have today is the last 100 years people can not
Was measured before, according to type of retailer inventory records of goods
calculated at 250 years ago, people can kind of consumption goods generally is 10 the
square It is hundreds. Now we can kind of products consumers are more than 10 of
the eight parties, with the 100 million kinds.
In 1820, the world's average life expectancy is 26 years old, and almost the
Roman era, to become a 67-year-old in 2002. Now, China's per capita life
expectancy reached 70 years of age.
Some young people do not understand history, may not know that China's
food stamps was abolished in 1994. Abolition of the ticket before, to have food
stamps to buy food grain shops, to buy oil oil ticket, buy a cloth with a cloth to vote.
30 years ago, a graduate of the national cadres wage is 50 yuan, then pound of eggs is
a hair more than 6 month's salary can buy 90 kilograms of eggs. Now,
Beijing is probably a nurse's monthly salary is about 1000, you can buy
300 kilograms of eggs. When I am in rural areas, farmers earn 2 cents a dry day living,
the value of a half dozen of flour. Now my home, one without any skills, only the
elementary school and junior high school who went to work in a day's pay
is 55 dollars, you can buy a bag of 50 kilograms of flour. This is the change in
China's reform and opening.
Why is the miracle of humanity in the past 250 years, the emergence of
China's economic miracle is only in the past 30 years there? Is not a person
to become more clever than the original, higher than the wisdom of the past? Of
course not. Human intelligence, wisdom, of written history, not much progress. Today
the Chinese people clever, I believe few can more than Confucius, Mencius, Lao Tzu.
In the West, too, human intelligence within the past two or three years did not change
Is change more resources? No. Human resources are not only not changed much, on
the contrary, the natural resources associated with the land is still diminishing. What
changed? The only answer I can offer is the man to implement a new economic
system, that a market economy. Western countries 200 years ago, the introduction of
market economy, so 200 years ago started to take off. China 30 years ago toward a
market economy, so China in the past 30 years, has undergone tremendous leap.
One of the characteristics of market economy: competition and create value for others
What is the market? Market is good or bad by someone else have the final say, not
help you have the final say in the system. In the market, a person does not create
value for others, it can not be income. So you must strive to create value for others.
Prices provide a signal, something valuable, something of no value, to test the market
to the buying of people. Nobody wants you for his services beyond the value of the
price paid. When two companies compete, we say the edge of a time when an
enterprise means that enterprise customers can create more surplus value, both the
consumer surplus. Competition between enterprises is the creation of surplus value to
consumers of competition.
Further to see how enterprises create more surplus value? Rely on innovation. Market
competition is not a simple price competition, but to see who is more capable of
producing new products, or manufacturing products in new ways; who is better able
to open up new markets, find new raw materials, the introduction of new
organizational forms, as create higher value consumers. Who can do this, who will be
able to get a bigger market. Competition among enterprises, promote the rapid
development of human society, so that in the past several hundred years, created a
history there has never been wealth.
Often have a misconception that the standard of living humans from technological
progress. The question is, why some will be under the system of technological
progress, and some will not be under the system of technological progress? What
drives technical progress? History has proven that only the market economy in order
to promote technological progress, and make the new technology will soon put into
operation, impact on human life. In ancient times, there are many technical inventions,
but very few of these inventions to create value for consumers, in order to create more
wealth. Because it is not under the pressure of competition in the market produce and
difficult to commercialize. Wise imaginary things by inspiration, not really meet the
needs of the consumers.
The second feature of market economy: the division of labor between strangers
The second feature of the market economy, is the cooperation between strangers. Two
one act, to do together than alone more In other words, cooperation can create value,
which is a basic principle of economics. However, this cooperation is not as simple as
people's communes, all of them together, do the same live, but the division
of labor, specialization based on cooperation. Division of labor and specialization can
maximize the advantages of each person, make the best use, best use, to promote
technological progress, it can create greater value.
Division of labor specialization is associated with the transaction. The exchange of
mankind will, before making a division of labor possible. However, information
asymmetry, in traditional societies, cooperation is often only between acquaintances,
between the blood of people, such as brothers and sisters, or the same village, people,
or people with a church to cooperate, it is difficult find cooperation between strangers.
The cooperation of human beings today, long beyond the region, beyond the borders
to the world. Today we have consumer goods, 99% of the producers you do not know;
a company's products sold, most consumers do not know him. It is this
large-scale, large-scale cooperation in making the world's wealth at an
alarming rate.
However, in order to achieve cooperation between strangers, there is a very important
issue must be resolved, and that is trust. If you do not trust other people, we dare not
buy his stuff, he can not sell him no good professional. The results, he had to own to
own production, it returned to the self-sufficient economy.
Therefore, the market economy, not only have an "invisible
hand", there is an "invisible eyes." In other words,
strangers can cooperate, because a pair of invisible eyes watch us, everyone has to
give presentations on their actions. Past criticism of the market economy, often
because people 只 know the one factor, but not a factor after seeing the effect and so
there is fraud Renweishichang Shang Yi Ding, Wu Shang is not evil. In fact, we see
that the more developed market economy where people are more concerned with their
credit. Particularly in business, to succeed in the market, we must establish a good
reputation. If his reputation is not good, no one trusted him, will be eliminated.
Establish market confidence in the key: business, profit and entrepreneurs
Trust in the markets is how to build up? I focus on three concepts: business, profit,
and entrepreneurs. These three concepts are the key to understanding the market
For example, China has 1.3 billion people, everyone is producing their own goods to
market and sell it, who can trust whom? Put another way, if all the goods market mark
are removed, you dares to buy something? May dares to buy potatoes, rice, fruits,
these simple products. Like cars, computers, mineral water, projector quality and
functionality of these things is not easy to distinguish, you dares to buy it? You dare
not, 99% of the market you do not dare to buy goods.
How to do that? One way to our 13 million people divided into different groups, for
example, is divided into 30 groups, from Henan Province, Hebei Province, Shandong
Province, Shaanxi people, Beijingers so. With this group, we do not know everyone,
but we know this is Shandong Province, which is Cantonese, you can make some
judgments. Enterprises like community groups, one for each enterprise has its own
name, who deceived us, we can choose to pursue him, or he lied to me this time, next
time do not buy his stuff, he will be finished. When society is divided into business,
every company must be responsible for their actions, so that we can build trust. If
there is no business, each person only engaged in individual production, can not do
Why companies allow us to trust each other? The answer with the ownership
allocation and profit. For example, a company formed by the 10 000 individuals, in
theory, everyone can become the owner. The annual profit of the enterprise is a
million and one million individuals equally, each taking 10 thousand dollars. This
seems very fair, but think about it, if a problem occurs, who is responsible? If you
expect everyone responsible, the result may be all irresponsible.
In reality, companies with another way to assign responsibility, some people assume
that negligence, the other person is strictly liable. Those who bear the blame to take
responsibility for contract income, that is, if he is not late and leave early, no
absenteeism, no violation of work rules, dry month, end of the month must be paid,
this is the staff. The other part, that employers should bear strict liability Or call
residual liability. With a popular saying, what staff? Others did not find your mistakes,
you are not wrong, this is called employees; What is the boss? You can not find the
mistakes of others, then all errors are you, that is the boss. Boss has no right in front
of consumers make mistakes because they did not ask the income; and workers can
make a mistake before the boss because he did not ask the income, which is the
difference between employers and employees.
Boss to take the profits and bear the responsibility of the consumer. Profit excluding
the cost of the income surplus may be positive, it may be negative. So it is an
incentive. Production of a product, I do not know which of the workers, why trust him?
There are people who assume the remaining responsibilities. The most simple
example, if you are a restaurant owner, cook vegetables and do not clean, people eat
diarrhea patient, you are responsible. Profits as a way to earn income, so that business
owners Chengdan residual liability, strict liability, any error committed by an
employee must bear the Lao Ban, therefore, employers must carefully supervising
staff. In this way, customers can confidently purchase business products.
Further, is not just the employees, including enterprise vendors mistakes, employers
have to take responsibility. Say you bought a brand computer, a certain computer parts,
such as screen, chips, fan out, or even battery explosion, and to bear the responsibility,
first of all computer makers, not the parts supplier. In other words, a brand company,
actually with their own brand in front of consumers set up a military order, go bail for
that, you buy me things, a problem for me. In this way, only you can rely on the
market, only the cooperation between strangers, have increased social wealth.
So I say, the market economy is a responsibility system, profit is an assessment
method. Market divided by corporate accounting unit of the organization form, back
through the profit responsibility, so that each individual is responsible for their
We talk about the market economy, entrepreneurs should never forget. Only from the
perspective of price, can not really understand the market economy. Regrettably, the
past all the economics textbooks, are not the status of entrepreneur. Schumpeter
criticized, economists are talking about economic growth, not as a Prince's
"Hamlet", the real hero is not played. Take profits are
entrepreneurs, he bears the entire social organization, production and supervision of
other people's role , Of course, the entrepreneurs here have said, not
referring to a specific person, is a function of the act; is said Among the market
economy, there is such a class of people, play such a role. Entrepreneurs in the market
economy plays a very important role. Entrepreneurs do not like, do not attach
importance to profits, and does not accept the market economy is the same thing.
Difficulties faced by Chinese entrepreneurs
In summary, the entrepreneur's work on two things: first, the response to
uncertainty. This is the 1921 U.S. economist Nai Teti out, he in his famous book
"Risk, Uncertainty and Profit," proved, there is no uncertainty,
there is no economic sense of the profits; profits is uncertain of compensation. Second,
the promotion of social innovation. Innovation is the responsibility of entrepreneurs,
not the responsibility of technical experts, technical experts only in invention,
innovation is the invention into a thing of value to consumers. Innovation is the
"creative destruction", such as now with the MP3, the
destruction of the Sony Walkman, Sony's Walkman, cassette recorder is the
destruction. Each new product is a product of the destruction of the original. This is
Schumpeter in 1911, "Economic Development Theory" put
forward important points.
Chinese entrepreneurs and developed market economies of Western entrepreneurs are
similar? Great concept from the point of view, is the same, regardless of
China's entrepreneurs, or the Western entrepreneurs, also addressed the
issue of uncertainty, are carrying out innovation. After the breakdown, we found that
different. Uncertainty can be divided into two categories, one is market uncertainty;
one is policy uncertainty. Innovation can also be divided into two categories, one
technical, business innovation, such as introduction of new products, new production
methods, new business models. Another is the system of innovation is to design some
new games may be the government's institutional arrangements.
This division, Western entrepreneurs and Chinese entrepreneurs difference emerged.
Western entrepreneurs, mainly deal with market uncertainty, the main technical and
business innovation. So their energy is mainly used to predict what the future
consumer tastes, technological development trend of the future what is, what kind of
new products to win market share. China's entrepreneurs, too many
policies in response to the uncertainty, for example, in order to be able to do this today,
tomorrow, is there anything we can do, such as bonuses can send, options can not
engage in, such as and so on. They are a lot of energy in response to the Government,
to find some way to bypass the existing policy, the so-called system of innovation.
It would appear that in the arena of global competition, Chinese enterprises in a very
disadvantageous position. Because consumers do not care what you busy all day long,
how hard work, not because Chinese entrepreneurs more than the U.S. entrepreneurs
busy, give them more pay. They only care about your products are better than others,
you create value is greater than others, and make choices accordingly. So Chinese
enterprises face great challenges.
This is not abstract and talk. We can investigate, Chinese entrepreneurs are not busy
than the foreign entrepreneurs. Foreign enterprises, regardless of how much the owner
will have their own vacation time, and his family together. The Chinese entrepreneurs,
with little time to leave, not even Sunday. Why? Because they have too much
uncertainty from the policy to deal with. An entrepreneur is hard to tell you that doing
next month. (This article Source: China Economic Net of: Weiying)