SLIDES&FOR& PRESENTATION Dr.$Francesco$ Grillo THE$CHINA$ - - PowerPoint PPT Presentation

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SLIDES&FOR& PRESENTATION Dr.$Francesco$ Grillo THE$CHINA$ - - PowerPoint PPT Presentation

SLIDES&FOR& PRESENTATION Dr.$Francesco$ Grillo THE$CHINA$ CENTRE,' OXFORD,' 25th%FEB%2019 MA MAIN%ME MESS SSAGES 1) 1)#W #WHA HAT#IS #IS#T #THE HE#B #BOOK#AB #ABOUT? 2) 2)#RE #REAS ASONS NS#F #FOR#C R#COMPARING


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SLIDES&FOR& PRESENTATION Dr.$Francesco$ Grillo THE$CHINA$ CENTRE,' OXFORD,' 25th%FEB%2019

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MA MAIN%ME MESS SSAGES

1) 1)#W #WHA HAT#IS #IS#T #THE HE#B #BOOK#AB #ABOUT? 2) 2)#RE #REAS ASONS NS#F #FOR#C R#COMPARING ARING#C #CHINA#AND#IT HINA#AND#ITAL ALY 3) 3)#T #THE HE#INNO #INNOVATIO ION#P N#PARADO ARADOX# X# 4) 4)#T #THE HE#DE #DEMOCRA RACY#P Y#PUZZLE ZZLE 5) 5)#RE #REAS ASONS NS#W #WHY#IS HY#IS#C #CHINA#AD HINA#ADAP APTING ING#B #BETTER#T R#THAN#IT HAN#ITAL ALY/#E #EUROPE#T #TO#T #THE HE#5T #5TH#T H#TECHNO HNOLOGIC ICAL# AL# RE REVOLUTIO ION*( N*(AND*W AND*WHY*T HY*THE HE*T *TRE REND*M ND*MAY*RE Y*REVERSE*IT *ITSELF LF) 6) 6)#HO #HOW#T #TO#F #FIX#DE IX#DEMOCRA RACY#T Y#TO#S #SOLVE#T #THE HE#P #PARADO ARADOX#O X#OF#INNO #INNOVATIO ION

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WH WHAT%IS%THE%BOOK%ABOUT?%

1) 1)#IT #IT#IS #IS#NO #NOT#A#B #A#BOOK#O #ON#C N#CHINA HINA.#NO #NOR#O R#ON#IT N#ITAL ALY.#IT #IT#IS #IS#A#( #A#(FIR IRST?) ?)#A #ATTEMPT#T #TO#U #UNDE NDERSTAND#HO AND#HOW#T #THE HE# RE RELA LATIO IONS NSHIP HIP,( ,(S),B ,BETWEEN,( N,(AND,T AND,THE HE,DE ,DEFINIT INITIO IONS NS,O ,OF),“ ,“DE DEMOCRA RACY”,,“ ,“INNO INNOVATIO ION” N”,AND,“ ,AND,“GROWTH” H”,IS" S" CH CHANGING'DUE'TO' O'THE'TECH CHNOL OLOG OGICA CAL'DISCON ONTINUITIES'WHICH CH'DEFI FINES'THE'XXIs Ist CE CENTURY( 2) 2)#T #THIS HIS#IS #IS#DO #DONE NE#T #THR HROUGH#T H#THE HE#C #COMPARIS ARISON#B N#BETWEEN#T N#THE HE#T #TWO#M #MOST#DIV #DIVERGING ING#C #CAS ASES#Y #YOU#C #CAN# AN# TH THINK&OF&AMONGST& GST&TH THE& E&BIG& G&(EN ENOUGH GH)&COUNTR TRIES&OF&TH THE& E&WORLD 3) 3)#IN#F #IN#FACT,#IN#T #IN#THE HE#LAS #LAST#T #THIR HIRTY#YE Y#YEAR ARS#( #(SINC INCE#1989 1989),#CHIN HINA HAS HAS$BEEN$ N$THE HE$FAS ASTEST$GROWING ING$COUNT NTRY$ Y$OF$ TH THE$ E$(NOT$ T$LIBER ERAL!DE DEMOCRA RACY,*AS *ASIAN) IAN)*P *PAR ART*O *OF*T *THE HE*W *WORLD*W RLD*WHIC HICH*HAS H*HAS*G *GROWN*M N*MORE RE.*IT *ITAL ALY*IS Y*IS*T *THE HE* SL SLOWEST'GROWING'COUNTRY'OF'THE'(WESTERN'LIB LIBERAL AL!DE DEMOCRA RACY) Y)*PAR ART%OF%THE HE%WORLD LD%WHIC WHICH% H%HAS HAS% GROWN& WN&LE LESS.& 4)"OUR"IN INIT ITIA IAL" L"WORKIN ING"HYP HYPOTHE HESIS IS"IS IS"THA HAT"THE HERE"ARE"TWO"ARGUMENTS"WHIC WHICH" H"CAN"EXPLA LAIN IN"THE HESE" TR TREN ENDS:(TH THE( E(FIRST( ST(IS(TH THE( E(INNO INNOVATIO ION' N'PAR ARAD ADOX;( ;(TH THE$ E$SE SECOND'IS' S'THE'LIBERAL'DE DEMOCRA RACY)P Y)PUZZLE ZZLE."O ."OUR" R" TH THESIS&IS&TH THAT& T&IN&ORDER ER&TO&SOLVE& E&TH THE& E&FORMER ER,&YOU&NEED EED&TO&FIX&TH THE& E&LATTER TER.& 5) 5)#T #THE HE#B #BOOK#IS #IS#C #CONC NCLUDE DED#B D#BY#T Y#TEN#IDE N#IDEAS AS#W #WHIC HICH#C H#CAN#DO AN#DO#T #THA HAT:#IN#A#NU :#IN#A#NUTSHE HELL LL,#T #THE HE#IDE #IDEA#IS A#IS#T #THA HAT#IN# #IN# OR ORDER%TO% O%SAVE VE%DEMOCR OCRACY CY%AND%THE%WEST,%YOU OU%NEED%TO% O%CH CHANGE%THE%INSTITUTION ONS%OF% OF%DEMOCR OCRACY CY% AND$ AND$TRANS RANSFORM RM$IT IT$INT INTO$A" A"CO COLLECTIVE(PROBLEM(SOLVING(EXERCISE((I. I.E.%A%“MET METHOD”/)I )INFORMA RMATION) SY SYSTEM STEM&TO&GATHE HER'IND INDIV IVID IDUAL' AL'PREFERENC NCES'INT INTO'COLLE LLECTIV IVE'INT INTELLIG LLIGENC NCE))WHIC HICH) H)IS IS#SOMETHING HING# TH THAT,%PARADOXICALLY,%MA MAY$G $GIVE$T E$TO$C $CHINA$T $THE$C E$CAPABILITY$T $TO$B $BET ETTER ER$A $ADAPT$T $TO$T $THE$MU E$MUTATION$T $THAT$W $WE$ E$ CA CALL$FI FIFT FTH$INDUSTRIAL$REVOL OLUTION ON

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TH THE$S $STAR ARTI TING$P $POINT$O T$OF$TH $THE$RE $RESEAR ARCH CH$(AN $(AND$TH $THE$$ $$ CONCL CLUSION(O (OF(P (PREVIOUS(Ph Ph.D." ."WORK"AT"THE"LSE LSE"AND"BOOK)

WH WHICH%IS%THE%RIGHT%«QUANTITY»%OF%PARTICIPATION%FOR%A%(INNOVATION)%POLICY% TO TO#WORK?#

INNOVATION POLICY PERFORMANCE OPENNESS OF POLICY MAKING

TOP$DOWN DISPERSED COOPERATIVE

Wales Scotland Castilla Y"Leon" Pais Vasco& South& Yorkshire Murcia

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SUSTAINABLE GROWTH DEMOCRACY

CENTRALLY) PLANNED FAILING'LIBERAL' DEMOCRACY PARTICIPATORY,* ELECTRONIC,* DIRECT' DEMOCRACY

CHINA ITALY ESTONIA,) SWITZERLAND,- AUSTRALIA,) CANADA

TH THE$ E$SCALE$ E$UP$ UP$OF$TH THE$ E$ARGUM GUMEN ENT$ T$AT$ T$A$GL GLOBAL$ LE LEVEL$ L$AND$ AND$THE HE$INIT INITIAL$ IAL$THE HESIS SIS

WH WHICH%IS%THE%RIGHT%«QUANTITY»%(OR%QUALITY)%OF%DEMO MOCRACY%FOR% (I (INNO NNOVATION( N(DR DRIVEN)( N)(GROWTH(TO(BE(SUSTAINA NABLE?(

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TWO$EXTREME$(AND$BIG)$CASES

  • 2nd$in$the$world$ranking$for$GDP$growth

since 1989

  • In#1989#the#poorest of#the#world
  • 70%$of$world$poverty reduction (between

1990$and$2015$! MDG)

  • Second'in'the'PISA'score'for'mathematics
  • 50%$of$the$266$world$unicorns are$chinese
  • Average HALE%higher than USA
  • One of#the#five left CP#led#countries of#the#

world&and&only one amongst them with%no% general'election

  • 188th%in%the%world%ranking%for%GDP%growth since

1989$

  • In#1994#the#fourth largest economy
  • Poverty tripled since 2005$(from$1.8$to$5.1$mio$
  • f#individuals in#absolute poverty)
  • Only OECD%country%net%exporter of#graduates
  • Position'number 24#in#the#EU#for#e!commerce
  • Highest HALE%in%the%EU%but dropped since 2014
  • Founder of#the#EU,#it is the$EU$country$where

people one of#the#highest ratio&between elections and$people

CHINA ITALY

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CHINA ESTONIA ITALY RUSSIA AUSTRALIA GERMANY UK US CANADA NORWAY JAPAN FRANCE BRAZIL CUBA UAE

LOW$GDP$GROWTH$ HIGH$DEMOCRACY

QATAR

HIGH GDP$GROWTH$ HIGH$DEMOCRACY HIGH GDP$GROWTH$ LOW DEMOCRACY LOW$GDP$GROWTH$ HIGH DEMOCRACY

Source:(Authors,(using(data(from(the(World(Bank(and(EIU

+ 10,0% ! 10,0$% + 5,0 ! 5,0

IS IS#THER HERE# E#AN#IN INCOMPARABIL ILIT ITIT ITY#IS ISSUE?# E?#THE# HE#LIB IBER ERAL#DEM EMOCRACY#PUZZL ZZLE# E#AND#THE# HE# AR ARGUM UMENT)OF)THE)“CATCH)UP UP”)AN AND)OF)“DEMOCRA RACY) Y)AS AS)LUX UXUR URY”

GD GDP$ P$gr growth'rates es'(1996 1996–2016;& 2016;&difference ces)ag again ainst'the'world ld'av average;'horizontal'axis)'and'Th The$Economis ist’s$ de democrac racy)i )inde ndex (2015;'from'0'to'10;'ver ertical'axis) s)'

THE$ARGUMENT$ (AND%ITS%OBJECTIONS)% CORRELATION:+!0,45 CORRELATION*(OECD*):*! 0,36 CORRELATION*(NOT*OECD):*! 0,61 NOT$TRUE$DEMOCRACY$IS$LUXURY UP#TO#1989#NO#«CATCH#UP»#AND# CORRELATIONS+WERE+POSITIVE

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$ $

  • f

$ $$ YEAR Source:(IDC,(UCB

130 1227 8591 40026

2005 2010 2015 2020

THE$INFORMATION$PARADOX$(1) – AGAINST'AN'INFORMATION'DELUGE..''

INFORMATION)STORED'IN'ALL'DIGITAL'DEVICES'(EXABYTES*)

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2,41% 1,84% 1,71% 1,37% 0,57% 0,00% 0,50% 1,00% 1,50% 2,00% 2,50% 3,00% 1971*1979 1980*1989 1990*1999 2000*2007 2007*2016

Source:(Authors(on(OECD(data

TH THE$INFORMATI TION$PARADOX$(2) .." .."PRODUC UCTIVITY" Y"IS" S"STAGNATING"AN AND"THIS" S"SE SEEMS" S"TO"CONTRAD ADICT"THE"DOMINAN ANT" EN ENDOGEN ENOUS(GROWTH( H(THE HEORY((LUCAS,(ROMER ER)

PR PRODUCTI TIVITY TY+GR GROWTH TH+RATE TES,+G7 G7,+AVER ERAGE+ GE+OF+YEARLY+INCREASE+ E+

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Source:(Authors(on(OECD(data

TH THE$INFORMATI TION$PARADOX$(3) HO HOWEV EVER ER'THIS HIS'DOES'NOT'SEEM EEM'TO'HA HAPPEN EN'IN IN'CHIN HINA

PR PRODUCTI TIVITY TY+GR GROWTH TH+RATE TES,+AVER ERAGE+ GE+OF+YEARLY+INCREASE+ E+

!6,00% !4,00% !2,00% 0,00% 2,00% 4,00% 6,00% 8,00% 10,00% 12,00% 14,00% 16,00% 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017

G7 China

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TH THE$ENTR TREPRENEURIAL$STATE TE$

PER PERCEN ENTAGE) GE)DISTR STRIBUTI TION)OF)WORLDWIDE) E)KILOMETR ETRES)OF)OPER PERATI TING) G)SUBWAYS)IN)CITI TIES)(LEF EFT) T)) AND$ AND$HIG HIGH!SP SPEED%TRAINS% S%(RIGHT)%IN%2018%(100%%16,339%KM%SU SUBWAY;%41,820%KM%HIGH!SP SPEED% TR TRAIN)

CHINA 34% USA 10% JAPAN 6% UK 4% GERMANY 3% ITALY 2% INDIA 3% RUSSIA 4% SPAIN 3% SOUTH;KOREA 6% OTHER; COUNTRIES 25% CHINA 64,2% JAPAN 7,3% SOUTH;KOREA 2,1% TURKEY 1,7% FRANCE 6,6% GERMANY 4,0% ITALY 2,3% SPAIN 7,0% UK 0,3% USA 1,8% OTHERS 2,6%

Source:(Authors,(using(data(from%UIC$(Union$International$des$Chemins$Fer)"and"International"Association"of"Public"Transport.

SIMILAR'PATTERNS'FOR RENEWABLE(ENERGY:(21% ELECTRIC'CARS:'32,2% 5G#TOWERS#(MORE#CHINA#IN# LAST% 3"MONTHS"THAN"USA"IN"THE" LAST% 3"YEARS)

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INVE INVESTMENT ENT(AS (AS(A(R (A(REF EFLECTIO ION(O N(OF(D (DIF IFFER ERENT ENT(APPR (APPROACH(T H(TO(T (TIM IME

Pe Percentage)investments)over)GDP)for)selected)BRIC)and)G7)countries)(1990 1990–2017) 2017)

10,00 15,00 20,00 25,00 30,00 35,00 40,00 45,00 50,00 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

China Germany India Italy Japan Russia United@States

CHINA&IS&LESS&THE&«FACTORY»& OF#THE#WORLD#THAN#EU# EXPORTS(OVER(GDP((2018)( CHINA:'19% ITALY:'26% WORLD:'28%

Source:(Authors,(using(data(from(the(World(Bank

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TH THE$COST$ T$OF$GOING$TOO$FAST$ T$FOR$TOO$LONG

Evolution)of#debt#over#GDP#in#China#(%,$2012–2017)

LEVERAGE'FOR'OECD' COUNTRIES: 260$IN$2007;$260$IN$2017

29,6 33 35,4 38,2 44,2 46,4 105,5 109,3 113 119,4 128,1 134,9 15,5 16 38,6 36,4 36,6 37,5

50 100 150 200 250 2012 2013 2014 2015 2016 2017

Households Companies Government

Source:(Authors,(using(data(from(IMF$data

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THE$«SECRET»$OF$THE$EXPERIMENTAL$ CENTRAL(PLANNER

PROBLEM( SETTING SOLUTIONS( GENERATION DEPLOY MENT EXPERI MENTS

FAILURE SUCCESS

  • 1. SELF%DRIVING%CAR%(IN%GUANGZHOU)
  • 2. DIGITAL'ROAD'(IN'BEIJING)
  • 3. FULLY%AUTOMATED%SUPERMARKET%(IN%BEIJING)
  • 4. ACTIVE'AGING'(IN'SHANGHAI'UNIVERSITIES)
  • 5. UNIVERSAL*BASIC*INCOME
  • 6. DRONES'AND'E'COMMERCE'(SICHUAN'COUNTRY'SIDE)
  • 7. CITIZENS(RATING(
  • 8. FACIAL&RECOGNITION&(IN&XINJIANG&AND&IN&SHENZHEN)
  • 9. CASHLESS'SOCIETY'(ALIPAY'AND'WECHAT)
  • 10. UNIVERSAL*TRANSLATORI

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TH THE$GREATE TEST$ T$OF$TH THE$SEVEN$CH CHALLENGES$– IN INEQU QUALIT ITY*IN IN*A*CPC*LED ED*COUNTRY

Sh Share&of#total#national#income# e#for#differ eren ent#segm segmen ents# s#of#the# e#Chinese# ese#population#by#income# e#level els# s# (1978 1978–2015) 2015)

Source:(Authors,(using(data(from%World&Inequality&Database'(PARIS'SCHOOL'OF'ECONOMICS)

10% 15% 20% 25% 30% 35% 40% 45% 50% 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Top$10% Middle&40% Bottom%50%

THE$GREATEST$CHALLENGE$ WILL$BE,$HOWEVER,$TO$ NAVIGATE(IN(UNCHARTERED( WATERS'WITHOUT'HAVING' SOMEBODY((THE(WEST)TO( FOLLOW

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IT ITALY’S(SYNDROME( E(– TOO#MUCH#PAS AST..# ..#

PU PUBLIC IC'EXPE XPENDIT ITURE'ON ON'PE PENSION IONS'AND'EDUCATION ION'(FROM OM'PR PRE'PR PRIM IMARY'TO' O'TERTIA IARY'EDUCATION ION)'(%;'2017;' 6" 6"MAJO JOR"EUROPEAN AN"ECONOMIES) Source:(Authors,(using(data(from%EUROSTAT

16,8 11,0 15,3 11,0 11,6 8,6 4,1 4,3 5,5 5,2 4,2 5,3 ITALY GERMANY FRANCE UK SPAIN POLAND PENSIONS EDUCATION 4,1 2,6 2,8 2,1 2,8 1,6

RATIO&&&&&&&&&&&&&&&&&& EXPENDITURE*FOR* PENSIONS'' VS#EXPENDITURE# FOR$EDUCATION 16

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TH THE$ITALIAN$JOB$ B$! .." .."AN AND"TOO"LITTLE"FUT UTUR URE

EM EMPLOYMEN ENT)RATES)(%) Source:(Authors,(using(data(from%ISTAT

65,5 66,3 53,4 58,6 55,5 58,0 58,7 64,4 54,2 47,9 58,1 67,2 40,0 50,0 60,0 70,0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

FINANCIAL CRISIS EURO7AREA ITALY (507; 60) ITALY (7ALL7) ITALY (257; 30)

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REASONS'FOR'HIGHER/'LOWER'CAPABILITY'TO' ADAPT

  • Central(planning(with(experiments

and$market$signals

  • Long%term view (marxism,"

confucian)

  • Democracy as informal problem

solving technique

  • Meritocracy
  • Study
  • No#strategy
  • Electoral cycles driven timing&in&

politics and$debate

  • Democracy as voting
  • Adverse selection
  • Highest ratio&between pensions and$

education

CHINA ITALY

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WH WHO$IS$GOING$TO$WI WIN$THE$21ST$CENTURY$(AND$WH WHERE$IS$THE$EU?) PROBLEM( SETTING INVENTION SOLUTIONS( GENERATION PRODUCT SOLUTIONS( EXPERIMENT ATION MARKETING SOCIAL' TRANSFOR MATION BUSINESS' SCALE&UP

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COLLECTIVE(CHOICES/( STATE ANIMAL&SPIRIT/& MARKETS

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FINE%TUNING%DEFINITIONS

  • DEMOCRACY

as a"method for$collective problem solving and$not just%voting

  • INNOVATION

as transformation of#a#society#and#not only R&D$expenditure

  • GROWTH

as enhancement of#capabilities and$not just%GDP

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SUSTAINABLE GROWTH DEMOCRACY

CENTRALLY) PLANNED FAILING'LIBERAL' DEMOCRACY KNOWLEDGE) DEMOCRACY

CHINA ITALY&AND&THE&EU ESTONIA,) SWITZERLAND,- AUSTRALIA,) CANADA

TH THE$ E$QUALIFICATI TION$OF$TH THE$ E$INITI TIAL$TH THESIS,$NEW EW$ RE RESEAR ARCH' CH'QU QUESTIO IONS NS'AND' AND'FU FURTHE HER' R'RE RESEAR ARCH CH

Further investigations

  • Much more%research on#

CHINA

  • Parallel between China&

today and$Japan$in$the$ eighties

  • More%research on#evolving

democracies

  • Experiments based research

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TEN$IDEAS$TOWARDS$A$KNOWLEDGE$DEMOCRACY$

1. Problem(based(deliberations((City(councils(in(Canada;(China) 2. More%information%rich%representative%democracies%(Australian;%but%US%Senate%as%examples) 3. Better%referenda%(Switzerland) 4. Qualifications,of#the#right#to#vote#need#to#be#explored((Switzerland) 5. Qualification+of+the+right+to+be+elected+needs+to+be+considered)(EU)elections)as)a)test) 6. Flexible'constituencies'should'be'introduced'to'take'on'board'new'forms'of'citizenship* (Estonia) 7. More%competition%in%traditional%media%and%more%responsibility%on%the%social%ones% 8. Big$data$aided$transparency$to$be$transformed$from$an$obligation$to$an$active$pursuit 9. Rule%of%law%needs%to%be%reconsidered%as#a#limit#to#power

  • 10. The$traditional$pre$requisite$of$better$democracy:$education,$freedom$and$economic$

freedom

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