gradipe07
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Y669 International Political Economy, Lecture #7 -- Lecture focusing on the economic strategies of Russia and China since the end of the Cold War.TRANSCRIPT
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Y669 International Political Economy
October 12, 2010
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The New Russia
This is Saint Basil’sCathedral in Red Square in Moscow, symbolicof the centralizedpower of the RussianState. The building ofnew churches in Moscowis symbolic of the endof Communism.
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Annual Growth in Real GDP in the Russian Federation, 1981-2006, in Percentages
Source: World Bank, World Data '95 CD-ROM (Washington, D.C.: World Bank, 1995); World Bank, World Development Indicators 2008.
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Russia Real GDP Growth, 2003-2010
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Russian GDP Growth and Crude Oil Prices, 1999-2007
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Figure 10-5. Budget Deficit/GDP and Growth in Consumer Prices in the Former Soviet Union and Russia, 1985-2006, in
Percentages
Sources: Stanley Fischer, “Russia and the Soviet Union Then and Now,” in Oliver J. Blanchard, Kenneth A. Froot, and Jeffrey D. Sachs, eds., The Transition in Europe: Country Studies (Volume 1) (Chicago: University of Chicago Press, 1994), p. 234; and Keith Bush, The Russian Economy in March 2002 (Washington: Center for Strategic and International Studies, 2002).
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Figure 10-4. Annual Growth in GNP in Eastern Europe, 1986-2006, in Percentages
Source: World Bank, World Development Indicators 2008.
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Figure 10-7. FDI Inflows in Billions of Current Dollars, 1990-2006
Source: World Bank, World Development Indicators 2008.
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Figure 10-6. Long-Term Debt Outstanding in Russia and Three Countries in Eastern Europe in Billions of Current
Dollars, 1981-2006
Source: World Bank, World Development Indicators 2008.
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Deng Xiaping’s 1978 Economic Reforms
• Household responsibility system
• Land use rights
• Township and Village Enterprises (TVEs)
• Special Economic Zones (SEZs)
Lester Thurow video
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Example: Shenzhen SEZ
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Yuan-Dollar Exchange Rate, 1980-2005
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Yuan-Dollar Exchange Rate, 2000-2010
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China US Trade Balance, 2007-2010
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Figure 10-11. Inflows and Outflows of Foreign Direct Investment into and from China, 1982-2006, in Billions of
Current Dollars
Source: World Bank, World Development Indicators 2008.
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Wal-Mart and China
• Wal-Mart is China's sixth largest export market. In 2006, Wal-Mart imported $27 billion of Chinese goods. Wal-Mart's imports are responsible for 11% of the growth of the total U.S. trade deficit with China between 2001 and 2006. [Time, 6/19/05; EPI Issue Brief #235, 6/27/07]
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Figure 10-9. U.S. Exports to and Imports from China, 1989-2007, in Billions of Current Dollars
Source: U.S. Census Bureau, Foreign Trade Statistics.Note: The trade balance is the difference between exports and imports.
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Real GDP Growth in China, 1961-2008
Source: World Bank, World Development Indicators 2008.
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Per Capita Income in China, 1960-2008
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Summary
• Russia elected to pursue a state-controlled energy-based growth strategy
• China elected to pursue its own form of the Asian developmental state approach, following the examples of Japan, Korea and Taiwan
• China’s strategy has been more successful but both are growing rapidly now
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What Happens to Specific Regimes?
Regimes Bretton Woods
Interdependence Globalization
Monetary Fixed but adjustable rates
Dirty Float Dirty Float; greater concerns about crises
Trade GATT GATT challenged (even by US)
WTO; rise of the anti-globalization movement
Investment Few rules other than retaliation
Period of nationalizations
TRIMs within the WTO; but MAI fails; rise of BITs