On the first Friday afternoon of the new school year, almost 100 students packed Aldrich 209 for a presentation by Prof. Zhang Jun on China’s economic development. The event was organized by the Asia Business Club.
Prof. Zhang Jun is one of the most prominent economists in China today, serving as the Associate Dean of the School of Economics at the prestigious Fudan University in Shanghai. After receiving his Ph.D. in Economics from Fudan in 1992, he has taught and researched at many universities overseas, including London School of Economics, Washington State University, Aarhus University in Denmark, and most recently, Harvard.
Adapting the latest economic theories from the West to China’s unique transitional economy, Prof. Zhang shared invaluable insights with his eager audience. He highlighted China’s impressive economic growth in the last two decades and several key challenges facing the nation as it prepares for its imminent entry into the WTO. He focused on the challenge of becoming more efficient in allocating the nation’s financial and capital resources. Prof. Zhang argued that most of the explosive growth since 1978 has been achieved through rapid capital asset accumulation, facilitated by China’s very high savings rate. However, to sustain high growth in the coming decades, China has to learn how to become more efficient in utilizing these assets. He pointed at China’s slowing GDP growth rates, from over 10% in the early 1990s to 7-8% in recent years, as evidence of the diminishing returns on new assets. He also pointed out that this challenge is not unique to China, and is in fact shared by several Asian countries including Singapore and South Korea. Time passed quickly and an intellectually curiousmix of first-and-second-year students asked questions on abstract economic terms such as Total Factor Productivity and Capital Output Ratio.
This was the last weekend in Boston for Prof. Zhang. Having spent one year as a research fellow at Harvard, he is going to UC Berkeley briefly before heading back to Shanghai, where he will resume his position at Fudan. We wish him the best and look forward to having him back in the near future with new insights on China’s great reform saga.