How to Win a Scholarship to University, part 3

How to Win a Scholarship to University, part 3

Recap of previous posts on how to win a scholarship 

In the previous two posts here on JC Economics Essays on how to successfully attain an undergraduate scholarship to university, I blogged about being prepared and ready for opportunities by starting early, studying hard, being polite and professional to teachers, tutors, and school administrators, and taking on leadership and volunteer or community positions, and how to plan for a scholarship to university. There were many questions that students would have to consider before applying for any scholarship (for a full recap, read this post on planning for a scholarship). 

Now, the next step is to craft a perfect personal statement, often in response to an essay prompt or some guidelines or guiding questions.  

Crafting the Perfect Personal Statement

How do we craft the perfect personal statement that would help a student gain entry into a prestigious university? 

This post here on my JC Economics Essays website will share some tips and techniques for drafting an excellent personal statement. 

In this post, we will refer to a personal essay, a statement of intent, and other forms of writing as a personal statement (to me, that is the most common way of referring to this specific type of writing). 

While no one can guarantee that a student's personal statement would be the best (naturally), and it often depends on what the student had done earlier in his academic life (remember what I said about getting strong grades, leadership positions, and volunteer or community work experience), one can always make the best personal statement one can - and hopefully that would be able to impress the assessors. 

In other words, write as best as you can - and hope for the best. The work that you have done will be able to help you. Your essay will hopefully be lit up by the brilliance of your achievements and contributions. 

First and foremost, before you start writing your personal statement - have a plan. 

This is similar to my previous post. 

Have a plan. 

And as I said before, if students fail to plan, then they plan to fail. 

Determine what the question is asking, and then outline your answer. What do you need to include in the response? What do you plan to argue, explain, and give examples for? 

If the question is asking about defining moments in your life, reflect on a few defining moments and lay them out on paper. 

If the prompt is asking about your experiences and knowledge of PPE - Politics, Philosophy, and Economics - then focus your thoughts and ideas on Politics, Philosophy, and Economics. 

If the guiding questions are more general, and asking you to focus on some ideas that have intrigued you, think about what books or articles you have read that really impressed you, impacted you, motivated you, or affected you. If the topic is on economics books - be sure that you start reflecting on economics books or journals that you have read. 

Second, be sure to bring in your strengths and knowledge into your response. 

This is a point worth repeating. 

The whole point of the personal statement is for you to show or demonstrate your strengths and knowledge into your response. The administrators and assessors cannot read your mind, so you will have to show them your strengths and knowledge. 

One way is to do it through citing your experiences, such as internships you have attended, relevant courses that you have taken, or volunteer work in a related field that you have done. 

If you are applying for law school, writing about the strengths you found in yourself while working at an intern in a fast-paced law firm would be useful; if you are applying for an economics undergraduate degree, then write about the online learning you have done on Keynesian economics, and what you have learnt about the difference between Monetarism, Classical Economics, and Keynesian Economics; and if you are applying for a social policy or sociology degree, be sure to write about your extensive volunteer work and how that taught you about income inequality or inequity in society. 

Through these examples, bring out your strengths, your good points, and the areas of knowledge or expertise that you may have. 

Notice that this really depends on the preparation work that you should have done before planning for universities and scholarships - please refer to parts 1 and 2 which I wrote earlier. The useful materials there will help you. 

Third, edit relentlessly. 

I have had former students write their personal statement once, and then they wanted me to have a look. Much of their writing was woefully inadequate for entry to university. Edit, edit, and edit again. 

If you have written a first draft, just be sure that you know that it can be better. 

Remember: that which is written without much care is seldom read with pleasure. 

The greater the pleasure you get from reading something, the greater the effort that went into it. 

When editing, there are many things to take note of:

Did you write in the right tone and register? Are you being too informal, or overly formal? 

How accurate are the terms and phrases you are using in the personal statement? Were you the Chairman, or the Assistant Chairman? Did you win the Gold Award or the Silver Award? 

Did you clear all the typos and spelling mistakes? 

Have you ensured that there is consistency in the terms used? 

And a common point often missed out is - have you used the right language? 

If you are applying for a college degree in the USA, please write in American English. 

If you are writing a personal statement meant for a UK university, please write in British English. 

If you are writing a personal statement for the University Scholars Programme in Singapore - whether the NUS or the NTU one - then be sure to use British English as well, as that is what we use in Singapore. 

Remember the Biblical phrase: Those who can be trusted in little things can be trusted in great things. Essentially, if you have not used terms consistently, and cannot even write properly, how can the reader or assessor trust you? 

Fourth, emphasise meaning and significance, but be sure not to overstate your case.

This is important. 

Many students do not know how to emphasise the meaning and significance of what they have done. 

Consider the following examples of weak sentences (from actual students):

I was Chairperson of ABC committee, I was Vice President of XYZ sport, and I participated in the JJJ seminar in YYYY year. 

I was selected class Chairperson and I was tasked to do many activities. 

I am deeply interested in accountancy and want to change the world. 

The first sentence is a pure listing - where is the meaning and significance? A stronger way of writing would be: 

I was Chairperson of ABC committee, which I established in YYYY year. Even though I spent a lot of time starting up that new committee, I also played football and eventually rose through the ranks to become VP of the XYZ sporting team, which won three gold medals under my leadership. I headed the team in the JJJ seminar in YYYY, and we won third place for the first time in school history. 

The second sentence is weak because it comes across as passive and insignificant. Consider this instead: 

I was chosen to be class Chairperson in recognition of my contributions to the class, and I led many activities and initiatives, such as ... 

The third is just interesting... but could be stronger and better. In the end, I rewrote my student's entire personal statement:

I am deeply interested in studying accountancy at university because my father is an accountant and I want to follow in his footsteps. He once told me that accountancy could change the world. I was intrigued by his unusual comment. How could accountancy be as important or relevant as economics or finance? And my father said to me... 

Fourth, ask people who know to help you - but take their advice with caution. 

Always remember that there is great value in asking people to help you. 

They can share their advice and knowledge. They can point out areas for improvement. They can share ideas and pointers. And if they have applied to the same scholarship before, or the same university course, they can help you. Do your research and interview people; ask them for tips and tricks; and learn from others. 

But do take all advice with caution. 

Some students told me that they were told to use big words and fancy phrases. While that may work with some US universities, it does not work with UK universities as the British are often more understated and subtle. 

Yet others have told me that the personal statement should be full of sob stories and problems that one had to overcome. Yes, there is some value in showing good values of resilience and strength. 

However, do not overdo this. Also, if many people write like this, how do you differentiate yourself from the rest of them? 

What is your unique selling point if you are another one of the sob stories? 

Fifth, respect convention, but be unique and differentiated

Also, while it is convention to write in the conclusion "I would appreciate the opportunity to study at your fine institution", and some coaches and trainers even use similar phrases to coach and train their students, consider other ways of writing. 

There is nothing wrong with convention. However, be unique even while you are conventional. 

"Studying in London is a dream come true, and I hope to be given a chance to do so" could be reframed as "London is an exciting city - studying at the London School of Economics would be a double-win for me", which is more unique and edgy. 

Or perhaps "at your fine institution" could be phrased as "As the famous economist Keynes studied in this college and benefited from a first-rate education, it would be my privilege to have this same honour". 

You get what I mean - yes, by all means stick to convention, but what is your unique selling point? 

What is your unique way of writing and communicating? What is "you" about this? 

It is also convention to say that you are reading Economics because you are interested in it. I think everyone would say that (some are actually telling the truth). 

Do not write "I am interested in economics". A better and stronger way of saying it is "Reading Milton Friedman's book on XYZ opened my eyes to some economics topics, and sparked my interest in the subject". 

More information will be coming in future posts. 

For more tips and techniques on how to raise your chances of getting a top scholarship to university, stay tuned for more. Thank you for reading, and cheers! 

JC Economics Essays -- I am currently writing on how to win a scholarship to university, for young and budding scholars to read undergraduate degrees. Thank you for reading and I hope these materials help you. 

How to Win a Scholarship to University, part 2

How to Win a Scholarship to University, part 2

In the previous post on how to win an undergraduate scholarship to enter university, I emphasised the importance of starting early, studying hard and ensuring good grades as a bare minimum, being polite and considerate to your teachers and school administrators, and taking on leadership roles and doing community service or voluntary work in the larger community. 

This advice or guidance is useful as a starting point.  

It can also be simply summed up simply as being ready, and as I heard Les Brown say before:

It is better to be prepared and not have one, than to have an opportunity and not be prepared. 

After doing the hard work of studying hard, being prepared and attentive in class, attending seminars, lectures, tutorials, and lessons - it is time to make all the preparation count. 

What is the next step on the way to winning a scholarship? 

The next step is called planning. 

As the famous saying goes, if you fail to plan, you plan to fail. 

It's so important that I have to state it again. 

After you have done all the basics and have started early, you now need to plan and think through what you will need to win a scholarship to university. 

There are basically a few important things that you have to plan for to ensure that you are well-equipped and ready to apply for a scholarship to university. 

The best way of think of this stage is to think of the following questions, which will help you make your plans. 

Think of these questions as a checklist for your planning purposes. 

First, what university would you like to go to? 

This is not an easy question to answer at all. 

There are famous and branded universities in the USA, for example Ivy League universities. 

Ivy League colleges are considered the most prestigious in the USA. There are eight total colleges that are considered Ivy League, namely Brown University, Harvard University, Cornell University, Princeton University, Dartmouth University, Yale University, and Columbia University, and the University of Pennsylvania. Of all the institutions of higher learning, these elite universities are considered the most outstanding and sought-after.

There are also famous universities in the UK, like Oxbridge (i.e., Oxford or Cambridge) and other Russell Group universities, such as the London School of Economics and Political Science, King's College London, Imperial College, the University of Manchester, and so on. According to the Russell Group’s website, the 24 member universities (sometimes colleges) are world-class, research-intensive universities with their own unique and distinguishing characteristics, history, and ethos. The commonality is that these universities are committed to maintaining the best research, an outstanding teaching and learning experience for students, and unrivalled links with local and national business and the public sector. 

Singapore also has many strong local universities with global reach and impact - for example, the National University of Singapore (NUS) (and also its Duke-NUS Medical School and Yale-NUS College); Nanyang Technological University (NTU) (as well as the National Institute of Education, which sits within NTU); Singapore Management University (SMU); Singapore University of Technology and Design (SUTD); Singapore Institute of Technology (SIT); and the Singapore University of Social Sciences (SUSS). 

Some universities are stronger than others in certain degree courses; for example, LSE is very strong in Economics and is reputed to be one of the best in it. 

This brings us to our next question: 

Second, what university course would you like to apply for? 

There are many courses and degree programmes - double degree programmes; multi-disciplinary programmes; University Scholars Programmes; majors; minors; honours; and even non-honours. Bachelors of Arts; of Science; of Social Sciences. 

What university course would you like to apply for? 

What meets your talents, skills, and interests? 

What will be useful and helpful to you in the long run? 

There are many subjects. 

Since this website is basically about economics, the university degrees most related to economics are:

Mathematics, Mathematical Economics, Econometrics, Political Science, Business Administration, Management, and pure Economics programmes. 

What interests you? 

What would you find fitting, relevant, useful, and helpful to you? 

Third, which scholarship programmes are you intending to apply for? 

Similarly, this is not an easy question to answer at all. 

There are many types of scholarships, for example, private sector scholarships and government or public service scholarships. 

There are bond-free scholarships, and other scholarships which are bonded (i.e., there is an obligation to work for an employer for a certain period of time, should you take up the scholarship). 

There are partial scholarships, which do not pay for everything, and there are full scholarships, which pay for everything. Even the organisations, institutions, and services that offer scholarships are different. 

Fourth, what do you need for your application?

You will need references or testimonials; 

to deal with the application process, whether it is through the Common App or UCAS; 

to write a personal statement (often more than just one personal statement, each designed or targeted for a different target audience and with a different purpose); 

to take the SAT or ACT aptitude tests or entrance examinations, if any are needed; to prepare for an interview or even a series of interviews; and 

visa applications, and the list goes on. 

Think through and plan accordingly - what do you need for your university and scholarship application?

On that note, when planning, do remember: the timelines matter. 

They really do. 

Some applications are made before, and some are after, yet others are concurrent and simultaneous. 

You cannot report SAT scores that you have not attained, and you certainly want to find out if the university you are applying for accepts provisional scores or preliminary results from your preliminary examinations. 

If you want your teacher to write you a reference or testimonial, you will need to plan that out in advance:

Who will you ask? 

How long do they need? 

And how will they submit it, and will that take time? 

Buffer in more time. More time, more time. 

Don't do things last minute. 

In other words, think of what I said earlier - if you fail to plan, you plan to fail. 

Plan and think through what you need, and you are yet another step closer to success. 

While there is no guarantee that you will be successful in a scholarship application, each step you take helps you get closer and closer to your dream degree and aspiration to be a scholar. 

Thank you for reading and stay tuned for more. Thanks! 

JC Economics Essays

View: Income Inequality is NOT the Real Problem

This economics viewpoint is contributed by a former economics lecturer, and is inspired by his former economics students XB and ZB

Introduction to the View

This paper argues that, while many economists and journalists argue that income inequality is a problem in the world today, it is not fundamentally a real issue or problem, but the lack of economic growth and issues with social mobility are the larger problem. This paper takes a meandering view around various theories, ideas, and opinions surrounding this challenging and often controversial topic.

Income Inequality

What is income inequality? Income inequality is about the extent to which income is being distributed unevenly among a group of people. Economic inequalities are shown by people’s different economic positions within a distribution, in terms of wages, non-wage income, and wealth, for example. However, people’s economic positions are also related to other characteristics, for example, their level of disability, ethnic background, or gender.

Measurements of Income Inequality

And there are various ways of measuring economic inequality. 

While there is no systematic economic measure, and econometric statistics differ, there are some common measures, for instance, the Gini coefficient, which measures inequality across the whole of society. According to economic theory, if all the income went to one person and everyone else got nothing, the Gini coefficient would be equal to 1 (meaning maximum inequality). On the other hand, if income was shared equally, the Gini coefficient would equal 0 (maximum equality). In other words, the lower the Gini coefficient, the more equal a society, the coefficient itself being between 0 and 1, for those who are interested in mathematics.

And the Gini coefficient can measure inequality before or after tax and before or after housing or other related costs, and, most importantly for our purposes, will vary depending on what is actually being measured.

The Gini coefficient is also related to what is known as the Lorenz curve, another method of measuring income inequality. Basically, a Lorenz curve shows the percentage of income earned by a given percentage of the population. A ‘perfect’ income distribution would be one where each percentage received the same percentage of income. Perfect equality would be, for example, where 60 percent of the population gain 60 percent of national income. The further the Lorenz curve is from the 45 degree line, the less equal is the distribution of income. It might be interesting to know that the Lorenz curve is directly related to the Gini coefficient and the area under the curve can be used in calculations of the coefficient itself.

Issue of Poverty

Another related economic issue that has to be discussed when it comes to discussing income inequality is the issue of poverty.

What is it, really? People in poverty are those who are considerably worse-off than the majority of the population. Their level of economic deprivation means they are unable to access goods and services that most people consider necessary to an acceptable material standard of living, or to borrow an academic term, they lack economic affordances.

Absolute vs Relative Poverty

There are two main types of poverty that we can consider here. Poverty can be absolute, where absolute poverty refers to a level of deprivation that does not change over time, or a relative term in which relative poverty means that the definition fluctuates in line with changes in the general material living standard.

Inequality, by contrast, is always a relative economic term: it refers to the difference between levels of material living standards and/or income, across the whole economic distribution. In practice, poverty and inequality are correlated and often rise and fall together, but this need not always be so. For example, income inequality can be high in a society without high levels of poverty due to a large difference between the top and the middle of the income spectrum, especially in cities that are small and dependent on trade, such as coastal cities.

Technological Disruptions and Income Inequality? 

What causes income disparity? 

There are many reasons. It is my view, and the view of some respectable economists, that fundamentally, technological disruptions are right at the centre of income inequality. For example, some have argued that changing and evolving technology is the primary reason for the increasing income gap in the USA. For several decades after WWII, new technology was a great leveller in the US, providing good jobs for workers. In the 20th century, US income inequality reached its low point in the 1950s, when technological change was rapid and material living standards increased dramatically. But around the 1970s, technology’s economic impact began to change. It went from being an equaliser to a factor that became complementary to people who were highly trained and highly skilled. And, in that transition, less-skilled workers were left behind. This was also the time of globalisation, and in a related vein as we approached the financial crisis, there was massive deregulation, liberalisation, and lowering of corporate and income taxes which favoured the rich, wealthy, and skilled, vis-à-vis the poor, asset-poor, and unskilled workers who could not take advantage of these wonderful economic conditions that were propitious for those who could. (In this link, we discuss the economic impact of disruptive technology on Singapore.) 

Social and Economic Mobility 

Another related issue is one about social (and economic) mobility. In his very controversial tome Capital in the Twenty-First Century, Thomas Piketty noted that Napoleon justified concentrations of wealth and high levels of inequality in France because the nation was a meritocracy. If you worked hard and had talent, you could rise to the top of the metaphorical economic ladder. 

Some people say that such claims about income mobility have been made by the privileged at the top of the economic ladder. In fact, the American dream is similarly built on this central assertion. First used by the US historian James T. Adams in his book The Epic of America in 1931, the American dream is a term to describe the complex beliefs, religious promises, and political and social expectations in the US, and for a lot of people this American dream is connected to becoming wealthy and the ability to achieve everything if one only works hard enough for it. And for yet others, the dream is about liberty (not limited to economic liberty but certainly also making references to it) and the US being the country of unlimited economic opportunities.

What did Piketty say, Anyhow?

As an aside, who is Piketty in the first case, and what are his economic ideas? He has been rather famous for a few years now. 

According to The Economist, Capital in the Twenty-First Century was published in French in 2013 and in English in 2014. The English version became a bestseller, and prompted a debate on global inequality. Some economists even believe it caused a shift in the focus of economic policy toward distributional questions. 

According to Piketty, in the 18th and 19th centuries, western Europe was highly unequal. Private wealth dwarfed national income, concentrated in rich families who sat atop a rigid class structure. Only the chaos of WWI and WWII and the Great Depression in between disrupted this economic pattern of control. High taxes, rising inflation, and the growth of welfare states caused wealth to shrink dramatically, and ushered in a period in which both income and wealth were distributed in egalitarian fashion. (Do note the Eurocentric slant of his analysis and the provenance of his data.)

But the economic and political shocks of the early 20th century faded and wealth is now reasserting itself. On many economic measures, Piketty reckoned that the importance of wealth in modern economies was approaching levels seen before WWI. From this economic history, Piketty derives an economic theory of capital and inequality: other things being equal, faster economic growth will diminish the importance of wealth in a society, whereas slower growth will increase it, and demographic change that slows global economic growth will make capital more dominant. 

But there are no natural economic forces pushing against the steady concentration of wealth. Only a burst of rapid economic growth, for him, either from technological progress or rising population, or government intervention can keep economies from returning to patrimonial capitalism. 

Piketty in fact recommended adopting a global tax on wealth to prevent soaring inequality contributing to economic or political instability. The book has attracted plenty of criticism. Some wonder whether Piketty is right to extrapolate about the future from past data. And economic theory suggests that it should become harder to earn a good return on wealth the more there is of it, because of diminishing marginal returns. Also, today’s rich, such as Gates or Zuckerberg, come by wealth through work rather than inheritance. Piketty’s policy recommendations are likely ideologically than economically driven.

Is There a Problem with the US' Social and Economic Mobility?

But many of the economic sceptics nonetheless have kind words for the book’s contributions. And since the last few years nonetheless, however, the findings of Piketty and other economists have entered mainstream debate, challenging long-held assumptions. From examples in the USA, bringing into focus how lopsided US income distribution is, findings have not only shown that inequality is widespread, they have also demonstrated that there is relatively little opportunity for those in the lower quintiles of earners to move up to a higher bracket.

Economic conservatives have long argued that inequality is fine as long as income mobility is robust. However, economic data gathered since the early 2000s have shown that US social mobility is low and has been so for half a century, and indeed, it is considerably lower than the US’ European competitors, where social safety nets are much larger and taxes much higher.

In response, many economic commentators and journalists have decried the unequal distribution of income and wealth and argued that governments should limit inequality at the top and make it easier for people to climb the economic ladder. There is an economic problem with this, however. Think about it. For every poor kid who rises to the top fifth in income, someone must fall out of the top fifth. And the proportion of those who rose was never robust, even in the nineteenth century. Some go up, and others go down.

What matters more is absolute social mobility: the degree to which the economy can produce rising wages for all. In other words, the American dream should be built on expanding opportunities for society, which can only come about if average real wages go up. Earning more than your parents is as much or even more a result of the rise of wages after inflation across the economy as it is a reflection of income mobility. In other words, if you are born into the bottom quintile but real wages rise, you will likely exceed your parents’ income even if you remain in that quintile.

Possible Solutions

What we now know is that we cannot rely purely on social mobility to solve these economic problems. Because there has been economic growth, about two out of three children these days are doing better than their parents. But many of them are not doing much better, and about half of this group remain in the same quintile they were born into. Indeed, rising income inequality also makes it harder to move from one quintile to another: the rungs on the economic ladder are farther apart.

Redistribution is not a sustainable solution to the whole complicated issue: For two decades, the inequality lobby tended to focus on a tax solution – how the rich can be taxed more and how that tax can be better spent on reducing the gap between rich and poor. It is not a good way to solve the economic problem, although it is definitely a fast way of creating flatter income graphs. 

Social and Economic Policies

And the main point for all of us is that a combination of social policies and economic growth policies are needed to produce wages for all. They could include a higher minimum wage (but not necessarily a Universal Basic Income or universal income), child allowances, and more and higher level educational programmes. 

But they should also include serious economic stimulus measures by governments to promote economic growth. And for example, government spending programmes should aim to sustain decent income levels through unemployment insurance, expanded earned income and child tax credits, and outright cash allowances. The government should also aim at foundational projects that facilitate long-term economic growth, including expansion of transportation and online infrastructure.

Have Faster and More Economic Growth

There is simply no escaping the central fact here that welfare depends on faster economic growth. In fact, there is always some inequality in any vibrant economy. 

The focus should rightly be on the vitality of the overall economy. And to that end, equality of opportunity which gives workers chances to succeed, is the bigger and more important concern that all governments should address. Give more economic chances - but how can the economy create more economic opportunities?

Entrepreneurship

The answer could be entrepreneurship. In a related issue, this whole issue is related to the fact that we need more entrepreneurs in society as a whole. When entrepreneurship drops, job creation drops, dragging economic growth with it. Perhaps, economic innovation, creativity, and the willingness to take risks will reduce and ameliorate income inequality and produce economic growth for all – so perhaps in the final analysis pro-growth entrepreneurship is the real economic answer to income inequality.

JC Economics Essays - We aim to be an economics blog with opinions, views, and perspectives. The article was contributed by S and he worked in conjunction with XB and ZB. The rest of the research came from academic articles. (XB once raised some of these important economic issues at a forum and some of the views are his.) Thank you for reading and cheers. 

View: What's Wrong With Obamacare?

This economics perspectives essay is contributed by a loyal reader (MSc Economics)

I would like to share some simple views and perspectives about the debates about Obamacare, and its possible repeal by Donald Trump and the Republicans (afternote: President Trump after 20th Jan 2017). This economics essay is an opinion piece, and just takes a fluid and flowing approach, expressing my views and explaining issues as they arise, rather than making solid or theoretical economic arguments, since after all this is an emotive issue for many US citizens and for both Hilary/Obama supporters and Donald Trump supporters alike. 

First and foremost, what is Obamacare? Some people say it is "universal healthcare", and others say that it is "compulsory insurance mandate", and some don't even know it is. 

Here are some basics. 

Basically, Obamacare is an informal term for a law in the USA intended to improve access to health insurance for US citizens. And the official name of the law is the Affordable Care Act or the Patient Protection and Affordable Care Act in full. Basically, it requires that all US citizens purchase a Private Health Care plan, get an exemption, or pay a tax penalty on their federal income taxes. US citizens who cannot afford health insurance will either qualify for Medicare, Medicaid, CHIP (the Children’s Health Insurance Programme) or get social assistance in tax credits or economic assistance with up-front costs through their state’s Health Insurance Exchanges. If health insurance is still not affordable after financial assistance, or if it costs more than 8% of a family’s income for self-only coverage, an individual can be exempted from getting individual insurance.

And the Affordable Care Act does lots of important things, including offering US citizens a number of benefits, rights, and protections: for example, setting up an online Health Insurance Marketplace where Americans can purchase federally regulated and subsidised Health Insurance; expanding Medicaid to all US citizens in many states; improving Medicare for seniors and those with long-term disabilities; expanding employer coverage to millions of employees; and requiring most people to have coverage each month in order to get an exemption, or pay a fee. 

In my view, some of its provisions are simple common sense healthcare reforms. For example, in the past, there was no uniform system for showing benefits included in insurance plans, but under the Act, a simple, standardised document makes comparing insurance options easy. Reducing information asymmetry reduces market failure - a commonsense economic argument. And a common sense one too. I think there can be little serious debate against some of these clearly useful healthcare reforms. 

Some interesting provisions are that, among other provisions, the law eliminates lifetime and unreasonable annual limits on benefits completely by 2014; prevents individuals from being dropped from coverage for any reason, aside from fraud, which means that insurers are stopped from dropping patients when the cost of care gets too great; and provides assistance for those who are uninsured because of a pre-existing condition. Under this law, no one can be charged more or dropped from coverage due to having a pre-existing condition and cannot be charged more due to health status either. This wonderful idea only works when there is compulsory insurance, which is what Obamacare basically is. 

To return the question posed at the start - What's wrong with Obamacare? I think there's nothing wrong with Obamacare, from the perspective of those who are insured by it. (There are of course some problems with Obamacare, such as tax issues, which we can deal with later in a future discussion.)

In response, this is what Donald Trump has to say – most notably in what some have termed “a post truth world”, an age of misinformation, mistruths, rumours, and misrepresentation – “Obamacare collapses under its own weight if we don't repeal”. Any other points?

“One thing we have to do: Repeal and replace the disaster known as Obamacare. It's destroying our country. It's destroying our businesses. You take a look at the kind of numbers that that will cost us in the year '17, it is a disaster. It's probably going to die of its own weight. But Obamacare has to go. The premiums are going up 60 , 70 , 80 percent. Bad health care at the most expensive price. We have to repeal and replace Obamacare.”

Putting aside the questions of sanity and rationality, can Trump really do it? While rolling back Obamacare, as Donald Trump has promised to do in his first few days in the White House, could be accomplished easily, enacting the legislation necessary to replace the law while protecting millions of US citizens who depend on Obamacare may prove challenging. Such a major step to roll back benefits, a step unprecedented in modern US history, would destroy state healthcare markets in the US. 

The Republicans could roll back Obamacare… as they have done before. Using Senate rules that exempt some budget-related laws from filibuster, the Republicans have passed a bill before that eliminated hundreds of billions of dollars provided by the health law to expand Medicaid coverage for poor US citizens and subsidise health insurance for low and moderate income US citizens on marketplaces created by the law. The bill, which also scrapped the unpopular insurance mandate (which essentially penalises US citizens who do not have health insurance, because effectively the only way to pay for Obamacare is to ensure universal insurance), envisioned a phasing out of the current law, giving Republicans time to develop an alternative policy proposal.

The Republican plan would transform Medicaid, the government health programme for the poor, by eliminating federal rules that establish who should be covered, such as poor children and pregnant women, and which benefits should be offered, leaving those decisions to states. It should be pointed out that currently Medicaid and its related CHIP provide coverage to more than 70 million Americans. Another Republican approach may be that US citizens who don’t get coverage through an employer or through Medicare or Medicaid would qualify for a tax subsidy they could use to help offset the cost of a commercial insurance plan, similar to the system set up by the Affordable Care Act. Republicans argue these health plans would be more affordable than current plans available through Obamacare marketplaces because they would not be subject to as many federal regulations.

To conclude, while it looks like Donald Trump will get his way, we should think of this final point: before Obamacare was passed, an American citizen could be denied coverage or treatment because they had a pre-existing condition, be charged more because of their gender, or be dropped mid-treatment for making a simple mistake on his or her insurance application. Under Obamacare, all US citizens have access to a large number of unprecedented new benefits, rights, and protections. Think about losing that – and hopefully loss aversion will stop the US from repealing this law. 

JC Economics Essays. An economics blog with opinions. Special thanks to SS for his personal contribution to this economics blog. The opinions and views expressed are the author’s own views and are all made in his own private capacity. And his economic research came from articles written about Obamacare and the US healthcare system. Thank you for reading and cheers. 

Explain how benefits to the USA economy can arise from specialisation and exchange. [10]

This economics paper explains how the United States of America’s (USA) economy benefits from specialisation and exchange. 

A country has a comparative advantage in producing a good if it has a lower opportunity cost of producing that good as compared to another country. According to David Ricardo’s law of comparative advantage, the USA will specialise in the production of goods in which it has a comparative advantage in, and use it to trade for goods in which it has comparative disadvantage in. International trade refers to the exchange of goods and services across international boundaries. The theory of comparative advantage theorises that trade arises because different countries have different opportunity costs.

By specialising and exporting goods in which the USA has a comparative advantage in while conversely importing goods in which it has a comparative disadvantage in, she would be able to increase her overall consumption of goods and services as compared to the situation under autarky – defined as the situation without trade. Hence, USA citizens would be able to consume beyond their Production Possibilities Curve (PPC) as a result of increased consumption possibilities. According to ‘The World Factbook’, agriculture and services comprise 1.2 and 79.6 percent of USA’s gross domestic product (GDP) in 2014 respectively. Gross domestic product is defined as the total value of final goods and services produced in a country's domestic area over a given period of time, usually a year. A developed country with a strong technological and capital base such as the USA would have a comparative advantage in the production of high-tech and high-value services, such as banking and shipping. In turn for exporting these, it imports goods such as agriculture from other countries which have a comparative advantage in producing agriculture, such as land-abundant Thailand, or a labour-abundant country such as the People's Republic of China which would produce labour-intensive economic products.

Aside from higher consumption possibilities, there exists other benefits to the USA economy arising from international trade. International trade allows for the USA to produce for a larger world market, thus enabling economies of scale to be reaped. Economies of scale refer to the fall in Long Run Average Costs (LRAC) as output increases. Foreign competition also forces domestic producers to innovate, cut costs and improve product quality. A case in point would be the consumer electronics industry – where American multinational technology company Apple has had increased competition from foreign competitors such as rival Samsung. The exploitation of economies of scale and greater competition improves both productive and allocative efficiency, thereby enabling the USA to better utilise scarce resources in maximising its economic welfare.

Opening up to international trade helps the USA attract Foreign Direct Investment (FDI). FDI arguably results in not just technological transfer, but also the transmission of ideas, technical expertise, and managerial skills, all of which are important contributing factors to the USA’s long-run economic growth. According to ‘The World Factbook’, the USA is the largest recipient of Foreign Direct Investment (FDI) in the world, with a total of 2.8 trillion USD in 2013.

Besides attracting FDI, engaging in international trade also facilitates structural economic change. Developing an economic structure that supports the exporting of goods leads to the expansion of services such as shipping, air travel, banking and finance services. The economy would therefore mature and develop, becoming less dependent on manufacturing, diversifying into higher-value services. This is evident in the USA economy, where the industry sector only comprises 19.2 percent of USA’s GDP, as compared to the service sector which comprises 79.6 percent.

In conclusion, specialisation and international trade brings about many benefits to the USA economy, and are not limited to those listed above.

JC Economics Essays - This is a model H1/H2 A level Economics essay for a part (a) question of 10 marks. This economics response was kindly contributed by Wilson YWS, a former economics student, and (after editing by an experienced economics tutor) is generally quite well written, especially for a 10 mark question under examination conditions. We can look forward to more H1 economics or H2 economics essays from Wilson in the future. 

However, how can this economics essay be even better written? What other salient points should have gone into the construction of this essay, and what economics diagrams would have been drawn to give this economics essay an even better mark? Also, conversely, what did this economics student include that was good to have but not really necessary? Do always think through the essays that you write and seek to do better each and every time. 

Thank you for reading, and cheers. 

"What difference did China’s high-yield agriculture make in China’s long-term growth and development?"

Shared master's students economics essays for LSE (London School of Economics and Political Science) MSc. 

EH446 Economic Development in East and Southeast Asia series 

For over two thousand years, the Chinese Empire was able to survive almost exclusively on its high-yielding agricultural sector. While many scholars have highlighted the short-term benefits, it is of equal importance to look at the long-term effects that high-yield agriculture had on the growth and development of the Chinese economy. When looking at the microeconomic side of Chinese growth and development, high-yield agriculture created prosperous conditions that had positive effects on the society. However, when looking at the macro aspect of Chinese economics, a different conclusion can be drawn. Many scholars have argued that while growth occurred throughout Imperial China, an emphasis on agriculture over any other sector ultimately stifled further economic development. Before delving into the question of whether long term economic growth and development occurred as a result of China’s high-yielding agriculture, one should first look at the social and economic conditions that allowed for and perpetuated the agrarian sector that is emblematic of Imperial Chinese economics. 

According to Deng, Imperial China was a physiocratic state whose society and economy were heavily impacted by their ability to harness and develop agricultural exploits.  Based upon a peasant-state relationship that was cultivated during the Qin dynasty, the majority peasant population was given land in exchange for loyalty and service to the emperor. That is to say, in order to expand territorial boundaries the Qin emperor employed rural peasants as soldiers and, in exchange for their services, they were rewarded a plot of land. This resulted in a system of ‘Chinese private land ownership’; an institutionalized sense of peasant entitlement linked directly to land ownership. Empire building in the early imperial period was based upon land proliferation and created pareto optimal conditions where the empire increased territory and tax revenue and the peasant class gained land and private property. As a result, Imperial China was largely rural and based on an agrarian or a  ‘customary’ economy.    As explained in his article Development and Its Deadlock in Imperial China, Deng explains that the Chinese socioeconomic structure had “three distinctive economic types - customary, market, and command - […and that] there were three main macrocomponents in the Chinese system” namely a rural sector, an urban sector and a combination rural/urban sector which contained amalgamations of the aforementioned three distinctive economic types. The rural sector made up the largest component of the Chinese economy and was marked predominantly by the customary type of economic activities with a smaller mercantile element.  The latter two, the urban and semi rural/semi urban types, made up smaller components of the economy. The urban type was predominantly mercantilist but also relied heavily on the customary sector for its survival.  The semi urban/semi rural sector was the state-run sector, which exemplified a command economy that “control[led] a considerable proportion of key commodities and their prices.”  It should be noted that, as a result of having a predominantly rural type economy, institutions that would protect private property and land holding would be of paramount importance in the Chinese social-state contract. In this way, land holding becomes part of the peasant endowment and the mass population becomes irrevocably linked to the land and her exploits. Together with institutions and an emphasis on the rural customary economy, the advent of a high-yielding agricultural economy as a hallmark of Imperial China is not surprising. With this framework of the Chinese economy in mind, it is now possible to explain how Chinese high-yield agriculture effected Chinese growth and development from a micro and macro standpoint. 

For the purpose of this paper, I will focus on two main elements that were greatly affected by high-yield agriculture. The first is that, due to an emphasis on agriculture, commercialization at the macro economic level was not able to evolve. At the micro economic level, commercialization did exist but was always overshadowed by the political, social and economic institutions that allowed for and maintained high yielding agriculture.

Throughout Imperial China, China’s economy was “fundamentally private and autonomous.”  That meant that while the state did collect taxes on agriculture, “[they] were normally low and predictable.”   In addition, the state was not responsible for providing welfare nets for its population. Therefore, individuals had to rely on their own productive capabilities to sustain themselves and their families. As a result, extensive land ownership and ipso facto high-yielding agriculture made it possible for peasants to support themselves. This is linked fundamentally with the idea of rational choice. As Deng explains:

“Any equilibrium [of a mixed economy between commerce and agriculture] could only be reached voluntarily by the choices of the majority in society. If voluntary, such choices had to be rational and if rational, then guided by economic incentives. These incentives had to be derived from particular institutions. The Chinese landholding system generated strong incentives for the farmer to stay in agriculture as his lifetime employment.” 

In other words, economic incentives were based upon the Chinese landholding system. In this way, people were tied to their land and would use their productive capacity to favor economic activities that took advantage of their land endowment. Since they did not rely on the state for their welfare, they had to be able to provide for it themselves through farming. 

While agriculture came first, farmers at the village level still needed to buy tools and purchase commodities. This facilitated the existence of local or micro level commodity markets and for proto-industrialization. Due to the ability to produce high yielding crops, many peasants found themselves with leisure time thus allowing them to participate in a wide range of non-agricultural activities. In essence, it was high yielding agriculture that “supported commercial activities in Imperial China whether spare time driven or spare produce driven. Here what the peasants aimed at was not economies of scale but economies of scope.”   While diverse commercial markets did exist at local levels, it should be noted that they did not exist beyond that because there were many disincentives for a peasant to completely rely on commercial activities. Since the livelihood of the peasantry relied so heavily on owning property and farming on it, rational choice pushed people away from becoming merchants or relying on commercial markets. The peasantry was greatly risk adverse and since there was little to no institutional security in sectors beyond agriculture, it discouraged people from increasing their productive capacity in something other than farming. As Deng explains, “to conceptualize this hyper propensity for land ownership, the opportunity costs for peasants to lose land [and hence, to leave agriculture] must have been very high - so high that only extra economic force was able to separate a peasant from his land.”   As a result, despite having entrepreneurial prowess, the peasantry would not leave agriculture and so, China would not see an integrated single market economy. 

Moreover, those that were in the merchant sector were also greatly affected by the emphasis on land ownership. Merchants would use their capital investing in land or education but not on continued commercial enterprise, as this was not seen as honorable. In this way, at the microeconomic level, there was a commercial market or mercantile element to the economic system based upon high yielding agriculture; “Chinese land ownership […] encouraged production, supported commercialization and induced urbanization but only to a degree.”  However, at a macro level, “China’s loosely connected localized markets [did not] converg[e] enough to be integrated into a single market.”   That is to say that the peasant, while being active in local markets, and gaining a surplus wage as a result, had no incentive to fully commercialize and give up the security they had intrinsic in the land ownership system. The opportunity cost of losing their endowment for potential high salaries was too high a risk since the state and economy did not readily support broad commercialization and merchants did not have the same assurances of sustainability, as did the rural agrarian society. In other words, linkages to land ownership pushed would be merchants away from creating larger, more diversified markets and forces the mass population to remain in agrarian modes of production. In this sense, high-yielding agriculture had a long run macro economic tendency to stifle increased and diversified commercialization. This had a profound effect on China’s long run development trajectory. 

The second element being addressed is the effect that a predominantly agrarian economy had on innovative technology as population increased. Due to a rural sector that could produce high levels of staple crops, the Chinese population grew at an alarming rate throughout the imperial period. However, as Myers points out, the “Chinese economy, after the eleventh century, merely grew larger in size”  but did not result in the development of a new production system based in something other than the agrarian model. The macro economic implication for the Chinese economy is that it did achieve growth but actually stifled technological development in that and other sectors. 

Before delving into this discussion further, it is useful to look at the Malthusian analysis of population growth and the subsequent work by Mark Elvin. First, Malthus observed that “a complex relationship among technology, population and available resources in any society inevitably produces two distinct trends.”  The first trend is that, a society’s capability to produce goods and services from a given resource base is directly correlated to the society’s use of increased technology and will cause an increase in living standards. It follows that as living standards increase, this will encourage growth in the population. At a given point, population “presses against the available resource base and the productivity of new entrants into the labor force steadily decline […] gradually lowering living standards.”  From here, Mark Elvin expanded upon the Malthus model to explain “the remarkable market organization and institutional changes that occurred [after the 17th century] and that supported huge population growth without fundamental economic development [could be conceptualized] as a high level equilibrium trap.”   

In other words, when placed in the Chinese perspective, the economy had “achieved impressive improvements in traditional technology alone” so much so that the Chinese economy had achieved very high productivity through the agriculture sector. The Chinese high-yield agricultural system had provided the population with its subsistent needs. At this point, it would follow that as the population grew, this sector would no longer be able to support the population at a subsistent level and this would necessitate a transformation in the technological capacities of the sector to allow for new sustainable capacities. However, as we see, population over growth did not cause for an institutional change nor did it bring about the traditional Malthusian checks on population, i.e. famine, disease - to limit the population growth. Due to the propensity of high yielding agriculture to produce a large enough food supply, the rural sector was able to postpone Elvin’s high-level equilibrium. This creates a situation where, in the macro economy, China saw growth but not an increase in development. By the end of the imperial period, high-yielding agriculture had created a population of subsistence farms.

At the crux of this second element lies the fact that high-yield agriculture truly stifled innovative technologies and prevented Chinese productive capacities to go beyond labor-intensive production. Bray, for example, speaks of Chinese “agriculture in late imperial [period] in terms of stagnation, involution or growth without development. [She] holds that although improvements in the micro-management of farming continued to produce small increases in crop yield, this was at the expense of the productivity of labor.”   

Magnus, via Perkins highlights this reality by explaining that while total grain output did rise in the same proportion as population,  the increase in agricultural yield was not due to technical innovation in the late imperial period. Rather, he, like Bray, characterizes this period as one of “technical stagnation mainly because there was little change in farm tools.”  Perkins attributes this high yield, rather, to the fact that land was under constant cultivation and that this sector was still riding on successful cultivating advancements of highly successful innovative technologies implemented in the Tang and Song periods through institutionalized adjustments. During that time, innovations in hydraulics, diffusion of agrarian practices, and official development of early ripening seeds, allowed for such high-yielding agriculture such as multi cropping of rice. So while these innovations occurred early on, there were no significant changes in the way that the peasantry farmed over several centuries. As Bray explains, by simply adding more labor inputs, agriculture was able to yield more without significant changes in the type of labor technology employed. This is not to say that farming did not undergo transformation, the key is that high-yielding agriculture perpetuated a system that allowed farmers to continue the type of labor they had successfully mastered for centuries without significant change in the skill set required to yield continued surplus. 

To further this argument, Boserup explained, “a distinction may be made between two types of innovations in farming technology - labor saving and labor using.”  In the case of Imperial China, it is clear that we are looking at a case of labor using innovations. Boserup points out that the two types of innovations differ in three important ways, first, “innovations of labor saving technology tend to raise the returns per unit of labor whereas opposite is true of with new labor using technology.”  Second, you would need to use greater amounts of labor to offset the initial disadvantage.  Thirdly, while new labor saving technology required invention in other areas, such as engineering, Boserup explains, “labor using technologies may be first invented in a few pockets of high population density.”  As such, we see that this is compatible with the fact that as the population grew, it was simply implemented into the production of high-yielding agriculture.  So while there was transformation in the cropping systems, Chinese farmers relied on labor intensity and not innovations of mechanized tools to support the growing population. With this emphasis on the use of labor and not on innovative technologies, high yield agriculture led to long run diminishing returns in labor, and diminishing standards of living. 

The high-yield agricultural system perpetuated an ever-resilient rural economy that significantly prevented long run development. While in the short run, “institutions that supported high yield agriculture [were] capable of alleviating short run human suffering, [but] China’s [agricultural…] resiliency prolonged its economic stagnation.”  The first element expresses that, while high yield agriculture did allow for localized markets, it did not allow for further development of commercial markets or non-agrarian sectors.  The effect was that there were no unified Chinese commercial markets and a very limited merchant class. In the long run, high yield agriculture forestalled significant development in non-agrarian markets.  The second element furthers the idea that long run development was not achieved as a result of high yield agriculture. As a result of production being so robust, high yield agriculture was able to support very large populations without necessitating extensive technological innovation. Moreover, since the peasantry could increase crop productivity by adding labor instead of introducing new technologies, there was no incentive to either change the methods of production or improve upon mechanical technology. While in the long run, high-yield agriculture allowed for population growth, it did not allow for technological innovations in this sector and prevented the population from shifting to another sector to sustain itself. In this way, long run development was significantly curtailed. As a result, reliance on high yield agriculture had a two-fold detrimental effect on Chinese long run development in terms of sector (especially commercial) diversity and technological development.  

Chinese high yield agriculture was ultimately more disadvantageous to Chinese long run growth and development. 

JC Economics Essays - This short series on JC Economics Essays is a set of shared economics essays on economic development, shared by my former classmates KVL and TZ with me when we were reading our MSc. at LSE, London, United Kingdom. We shared essays so that we could gain additional perspectives on how to craft good essays to get a high grade for the Master's degree at LSE, and that was a good way of sharing information and material. All the essays were graded highly by Dr Kent Deng, a very excellent and inspirational tutor and lecturer at the LSE when I was studying there. I hope you find the essays on economic development interesting or useful. Special thanks to KVL and TZ (both from the United States of America) for their kind sharing.

EH446 Economic Development of East and Southeast Asia

"In your opinion, was China capable of nurturing its indigenous Industrial Revolution?"

Shared master's students economics essays for LSE (London School of Economics and Political Science) MSc. 

EH446 Economic Development in East and Southeast Asia series 

Introduction

This essay aims to evaluate whether or not China was capable of nurturing its indigenous Industrial Revolution. In order to answer this question, it is important to first clarify the question by defining ‘indigenous Industrial Revolution’ and explaining what is meant by ‘capable.’ This essay will treat China’s ‘indigenous Industrial Revolution’ as the great achievements in science and technology during the Northern Song period.  ‘Capable’ is considered to mean China’s inherent ability to maintain and invigorate its technological momentum in the absence of outside forces (most notably, the pressure from Tatars and the Mongol invasion in the thirteenth century).

This analysis begins with a summary of the product and process innovations leading up to the thirteenth century, followed by the shift towards extensive-type growth in agriculture, transportation, and economics. An explanation of the role of the state will follow, highlighting the differing roles of ideology, competition, and science in order to compare the Chinese and British cases. Using the structure defined above, this essay finds that China possessed both inherent strengths and weaknesses for cultivating its indigenous Industrial Revolution. The positive factors that led to significant technological advancements in the Northern Song period persisted, as did economic (extensive) growth in the years that followed. China lost its ‘edge’ when intensive growth slowed due to government (dis)incentives and a lack of competition. By considering the debilitating impacts of these internal factors , this essay concludes that it would have been difficult for China to foster its own Industrial Revolution, even in the absence of foreign struggles.

Intensive Growth during the Northern Song

China’s great achievements during the Northern Song period did not happen overnight. Song success was the result of a long period in which a “well-functioning” system developed; by 300 B.C., China “had many characteristics of a market economy.”  From that point through the early twelfth century, an industrial revolution was in the making. Scholars point to China’s early arrival on the scene, predating the British Industrial Revolution by centuries. 

The Northern Song period witnessed the invention of many products including massive ships, the compass, and military tools.  As John Hobson points out in his critique of Eurocentric writers, objects designed for large-scale conflict and exploration were not the only innovations during this time period. While useful for military technology, iron was also used to produce commonplace items such as shovels, stoves, and nails.  Iron was not alone in its versatility; paper was also used widely in China before reaching the West, for such disparate functions as wallpaper, money, shoes, and even military armour. 

In addition to the various new products that surfaced during the incubation of China’s Song Revolution, many process innovations also occurred. Metal treatment technologies such as smelting, confusion, oxidisation, and decarbonisation were mastered during this period, rendering Chinese cast iron production and metallurgy practices less expensive and more diverse.  In the textile industry, the introduction of spinning wheels using hemp and silk marked a great procedural improvement in this field.  It was these technological innovations in products and methods that stimulated China’s economic growth through the Northern Song period.

Extensive Growth during the Southern Song and Later

During the transition from the Northern Song to Southern Song period (in the early twelfth century), economic growth continued but its foundation shifted; society was no longer propelled by the innovative vigour of the preceding years. By the time the Ming Dynasty came to power in 1368, a new trend had emerged. In The Lever of Riches, Joel Mokyr identifies the sources of this new kind of growth as the “expansion of internal commerce, monetization, and the colonization of the southern provinces,” also noting the growing population and agricultural “intensification” that continued through the nineteenth century.  

Agricultural “intensification” efforts differed from the agricultural inventions of the Northern Song period in that they were not unique, novel creations. In most cases, such efforts were manifested in the form of small improvements to existing products or practices.  In his article, ‘The Needham Puzzle: Why the Industrial Revolution did not Originate in China’, Justin Yifu Lin cites some examples, including the share plow for creating furrows in soil and the introduction of Champa rice to be grown in the southern provinces.  Seed drills, weeding tools, fertilizers, and pest control also emerged during this time. 

As the population shifted southwards and agriculture adapted to gain the most from this territory, transportation capabilities were also bolstered. The Chinese used internal waterways to send coal, iron, and steel south to meet the demand from these provinces.  In addition to the physical infrastructure, fiscal systems were also created to tax and regulate internal and international commercial activity.  The change from China’s intensive economic growth during the Song technology boom to the more extensive pattern in the years that followed was not simply a function of northern aggression and natural conditions. Institutions, ideologies, and methods of innovation also played a role in determining why China’s Song Revolution did not follow the same trajectory as the later British Industrial Revolution.

Institutions, Ideologies, and Incentives

The Chinese government played an integral part in the state’s economic development. Agriculture flourished in part because of government incentives and advantageous loan conditions.  The close alignment of the state apparatus with the economy created a kind of symbiotic relationship between the Chinese government and science and technology: when the state was strong, innovation thrived. In their essay, ‘The Evolution of Chinese Science and Technology’, Jin Guantao, Fan Dainian, Fan Hongye and Liu Qingfeng cite an example of this in the textile industry – noting that textile technology blossomed during the successful Song period, but then “degenerated as the dynasty collapsed and upheaval and destruction set in.” 

Scholars who attribute the stagnation of the Chinese Industrial Revolution to restrictive state action have been criticized for exhibiting a Eurocentric bias.  While this may be a valid contention, it is important to note the shift in ideology when the Ming Dynasty came to power. “Obedience” and “conformism” have been used to describe key values that prevailed during their rule.  John Hobson attributes the 1434 Ming ban on foreign trade to a return to Confucian principles; he asserts that it was more important for the Ming rulers to maintain the ban in theory in order to retain regime legitimacy, while the ban was loosely enforced in practice.  

One critical difference between the political climate of the technology revolutions in China and Britain was the lack of competition in the Chinese case.  The absence of public debate and a competitive market during the Ming slowed the type of accelerated growth that had been achieved during the Song and that was later seen in the British case. The strong state and its roots in Confucianism also stifled the kinds of scientific experiments that led to significant discoveries later in Europe. Confucianism valued knowledge learned from direct experiences over experiments, going so far as to deem the latter to be “witchcraft.”  The benefits of a system that intertwined science and technology were realized in Britain during the Scientific Revolution. In China, these remained discrete concepts and thus lacked the benefits of this kind of synergetic “feedback” mechanism. 

Conclusion

To answer the original question, was China capable of nurturing its indigenous Industrial Revolution, this essay has raised several points. First, although economic growth remained positive, there was a shift from intensive to extensive growth after the fall of the Song Dynasty, which was significant for the future of technological innovation. When this shift is considered in conjunction with state Confucian ideology, a lack of competition and the limited interaction between scientific methods and technology, China’s ability to maintain the technological strength of the Song Revolution even in the absence of external threats seems relatively weak. 

JC Economics Essays - This short series on JC Economics Essays is a set of shared economics essays on economic development, shared by my former economic history classmates KVL and TZ with me when we were reading our MSc. (Masters of Science) at the London School of Economics (LSE), London, United Kingdom. We shared our economic history essays so that we could gain additional perspectives on how to craft good essays to get a high grade for the Master's degree at LSE, and that was a good way of sharing information and material. All the economic history essays were graded highly by Dr Kent Deng, a very excellent and inspirational tutor and lecturer at the LSE when I was studying there. I hope you find the essays on economic development interesting or useful. Special thanks to KVL and TZ (both from the United States of America) for their kind sharing. Thank you for reading and cheers. 

EH446 Economic Development of East and Southeast Asia