"Marxism and Western Economics": A Summary of the 17th Symposium of the Chinese Association for Research on Foreign Economic Theories
To commemorate the 60th anniversary of the founding of the People's Republic of China, persist in and develop Marxist economics, and conduct in-depth research and correct utilization of foreign economic theories, the Chinese Association for Research on Foreign Economic Theories and the School of Economics and Management of South China Normal University held the 17th Annual Conference from November 27–29, 2009, under the theme "Marxism and Western Economics." A summary of the main viewpoints of the meeting follows.
1. Research on the Current Global Financial and Economic Crisis
In analyzing the causes of the current global financial and economic crisis, Cheng Enfu—the newly elected president of the Association, a Member of the Chinese Academy of Social Sciences, and Director of the CASS Institute of Marxism Studies—pointed out that compared to the eras of Marx and Lenin, the fundamental contradiction of today’s global capitalist economy is the contradiction between the continuous socialization and globalization of the economy and the private, collective, and state ownership of the factors of production, as well as the contradiction with the anarchic or disordered state of the national economy. This expanded global fundamental economic contradiction leads to subprime crises, financial crises, and economic crises through the following four specific contradictions and intermediary links.
First, from the perspective of micro-foundations, private ownership and its corporate management models tend to create a situation where senior management, in pursuit of maximizing personal income, seeks to maximize profits. They increasingly adopt high-risk financial instruments and subprime lending methods, thereby brewing various crises. Second, from the perspective of economic structure, private ownership combined with a market economy tends to create relative overproduction and an imbalance in the ratio between the real economy and the virtual economy, leading to crises. Third, from the perspective of economic regulation, private monopoly groups and financial oligarchs tend to oppose state supervision and regulation, while the bourgeois state serves the economic base of private ownership. This results in the dual failure of both market and state regulation, thereby brewing crises. Fourth, from the perspective of distribution and consumption, private ownership combined with a market economy tends to create polarization in social wealth and income distribution. This leads to the contradiction between the unlimited expansion of production and the relatively shrinking effective demand [1] of the masses. The masses are forced into excessive consumer credit, including subprime loans, to maintain their livelihood, thus brewing various crises.
Ding Bing of the Capital University of Economics and Business, based on a comparative analysis of the Great Depression of 1929–1933 and the "Great Tsunami" of 2007–2009, pointed out that the two largest financial and economic crises experienced by the capitalist world in the past century share a common characteristic: both were closely related to the dominant Western economic theoretical and policy systems of their respective times. The first was the Great Depression of the 1930s; prior to that, neoclassic economic liberalism, represented by Marshall, held the dominant position in Western economics. This liberal theory held that relying solely on the free market mechanism could automatically achieve full employment equilibrium in the social economy, with neither overproduction nor unemployment. However, the Great Depression of the 1930s completely shattered the myth of this free equilibrium theory; therefore, that economic crisis marked the complete bankruptcy of neoclassical economics or traditional liberalism. The second is the current international financial and economic crisis, which is the inevitable result of the development of neoliberalism, which has dominated the West for the past 30 to 40 years.
Zhao Maolin of Anhui University of Finance and Economics argued that according to the logic of Marxist economic crises, the current crisis appears on the surface as banks issuing loans to borrowers with poor credit and low repayment ability, leading to rising default rates. However, its substance is an economic crisis of relative overproduction. Looking through the US economy in recent years, one can find the following facts: "National financial crisis ← Outbreak of subprime crisis ← Rising default rates ← Overdrawn consumption ← Overproduction ← Insufficient consumption capacity ← Contradiction between unlimited expansion of production and lagging consumption capacity ← Contradiction of the anarchic state of social production ← Fundamental contradiction of capitalism." This happens to fit the logic of Marxist economic crisis theory. Therefore, although the current international financial crisis differs in its form of manifestation from classical economic crises, its essence has not changed; the root causes lie in the fundamental contradictions of capitalism.
Du Jinmin and Xi Bin of Jinan University pointed out that the root cause of the subprime crisis was the mismatch between monetary and physical assets, which triggered a payment crisis and subsequently spread to the real economy; it represents a failure of government economic regulation. Government supervision focused only on the compliance of financial institutions cannot eliminate the non-equilibrium transfer and accumulation of wealth and the occurrence of crises. The subprime crisis is the joint result of market failure and government failure. Preventing the recurrence of crises cannot rely on the spontaneous adjustment of the market; instead, the government needs to comprehensively apply various economic functions based on different stages of economic development, assess the situation, make timely adjustments, act as the occasion requires, and ensure effective implementation.
Fang Xingqi of South China Normal University emphasized that since the outbreak of the financial crisis in the United States in the summer of 2007 and the triggering of the global financial tsunami, the economic policies of Western developed countries—led by the US—and emerging market economies have undergone a "transformation as drastic and sudden as that of 70 years ago." That is, they have shifted from economic policies based on neoconservative economics to those based on Keynesian economics. Consequently, it is inevitable that Keynesian theories of state intervention will replace market fundamentalism, just as they did 70 years ago. Strictly speaking, Paul Krugman had already foreseen the return of Keynesian "depression economics" at the end of the 1990s, but he did not expect a "financial tsunami" to occur, and thus could not have predicted that this return would be so "drastic and sudden." In any case, an "inflection point" is about to appear in Western economics, and Krugman's theory shows where Western economics will "turn." This is precisely the significance of our research into Krugman's theories.
Liu Wei of Dongguan University of Technology argued that Krugman's depression economics and financial crisis theories also have important implications for China. Although China’s economy has been in a relatively stable state of development, the problem of insufficient demand still exists within the economic entity. Currently, insufficient domestic demand is a major problem affecting China, and expanding domestic demand is the only way for China to respond to the global financial crisis. Fortunately, our government has deeply recognized this problem, and the 4-trillion-yuan investment [2] is beginning to show results.
Regarding the issue of preventing and responding to crises, Zheng Changde and Li Haifeng of Southwest Minzu University pointed out that after the collapse of the Bretton Woods system, the United States effectively ceased to bear the obligation of stabilizing the global exchange rate system. This became a major incentive for instability in the international financial system and has repeatedly brought profound crises to emerging market countries. China will also suffer serious losses; therefore, in the current international financial crisis environment, we should seize the opportunity of US dollar instability to construct a "Chanyuan [3] Zone" (中元区). This would be conducive to the development of China’s foreign trade and help China avoid losses caused by the shrinking value of foreign exchange reserves.
Ren Zhian and Yu Xia of Anhui University of Finance and Economics argued that while this financial crisis has a significant impact on the eastern regions with higher levels of opening up, it has brought unprecedented opportunities to the western regions. However, the financial crisis cannot change the current status of China’s regional development. In the post-crisis era, how to coordinate regional development will be the focus of our country’s work for a long time to come. The low-carbon economy has emerged as a new growth point for China’s regional economy in the post-crisis era, and its advantages point toward a development path for the eastern, central, and western regions.
Han Yuling of Shandong University of Finance pointed out that the influence of government procurement is no longer limited to simple fiscal expenditure management, but has expanded to the fields of macro-control of the national economy and international economic cooperation. In the context of the current global financial and economic crisis, government procurement has received special attention due to the policy functions assigned to it, being used by our government and some other countries as one of the important measures in economic stimulus packages.
Ji Yushan, Bai Yingzi, and Ji Ming of Jilin University argued that in 2009, the world economy fell into an overall recession, and China’s export-oriented, low-end industries faced immense pressure, with a grave export situation. Existing traditional comparative advantage theories can no longer fully meet the actual development needs of a large developing country like China at this stage, nor can they serve as the theoretical basis for China to formulate foreign trade development strategies. Therefore, we must jump out of the "comparative advantage trap" and transform comparative advantages into comprehensive competitive advantages with institutional innovation as the core.
Chen Yanlin and Cai Wei of South China Normal University argued that to reduce the risk of a long-term rise in the inflation rate, a "structural" adjustment of loan interest rates for different terms could be conducted—"adjusting short-term loan rates more, while adjusting long-term rates less or not at all"—to signal the central bank's "anti-inflation" policy goal.
Deng Yujun of South China Normal University argued that developing Special Drawing Rights (SDR) into a supra-sovereign reserve currency to replace the existing US dollar standard is by no means easy and cannot be achieved overnight; it may be a goal that can only be realized in the long term (in the words of Zhou Xiaochuan [4]). However, it must be noted that as the economic strength of developing countries, represented by emerging economies, increases, their discourse power and voting rights in international organizations will grow accordingly. As the world's understanding of the root causes of the current global financial storm deepens and a consensus gradually forms, countries, through joint efforts and a step-by-step approach, can gradually expand the scope of SDR use and give full play to its role. The great vision of developing it into a supra-sovereign reserve currency to replace the current US dollar standard and establishing a new international monetary system conducive to global financial stability and long-term world economic development is very likely to become a reality!
Zhang Qiu of South China Normal University argued that with the consolidation of the Euro and the rise of economies such as China, Russia, India, and Brazil, the hegemony of the US dollar—which lacks the support of corresponding economic strength—is unsustainable. The myth of "turning paper into gold" is facing its end, and it is highly necessary to establish a new monetary system based on the reality of the world economy. Although promoting the reform of the international monetary system is an arduous task, this US dollar crisis shows that the inherent flaws of the international monetary system have reached a point where reform is imperative. We cannot continue to accept this unreasonable system simply because of US hegemony.
Hu Haifeng and Sun Fei of Beijing Normal University pointed out that by comparing various costs of two banking crises from the perspective of crisis costs, and seeking a reasonable and effective crisis management model on this basis, it holds significant theoretical and practical importance for China to improve its banking crisis management system and maintain the healthy and stable development of its commercial banks.
Zheng Lingling of Beijing City University argued that the relationship between deflation and economic growth is very complex; it is more advisable to define deflation as a pure phenomenon of a continuous decline in prices to study its mechanism of action on economic growth. Deflation or inflation are not the root causes of economic crises; they merely play a role in promoting economic deterioration. Facing an economic crisis, it is more necessary to deeply analyze its root causes.
2. Comparative Research on Marxist Economics and Western Economics
Honorary President and First-Class Professor at Renmin University of China, Wu Yifeng, pointed out that on the issue of the object of study, the fundamental disagreement between Marxist economics and Western economics does not lie in whether to study the allocation of resources, but rather in: (1) whether to study the mode of production; (2) whether to study the relations of production corresponding to the mode of production; (3) whether to distinguish between the allocation of resources in terms of "production in general" in the abstract and the allocation of resources in specific, particular modes of production, as well as whether to study the latter. On all these issues, Marxist economics answers in the affirmative, while Western economics answers in the negative.
In short, the definition of Marxist economics provides an accurate explanation of the essential characteristics of political economy or economics. Taking the mode of production and its corresponding relations of production as the object of study not only does not exclude the study of resource allocation but also provides a scientific theoretical basis for the distinction and research between resource allocation in general and resource allocation in specific modes of production. Conversely, the definition of economics by Robbins [5] and his followers does not touch upon the essential characteristics of economics at all. Their definition takes the allocation of scarce resources as the object of study and is satisfied with the investigation of abstract and supposedly "trans-institutional" resource allocation. This not only excludes the study of specific modes of production and their corresponding relations of production but also excludes the prerequisites for correctly understanding and recognizing the allocation of resources within a specific mode of production.
Regarding the study of Marxist economics, Professor Li Chong, Vice Chairman and Professor at the School of Economics and Business Administration of Beijing Normal University, argues that it is necessary to construct a Marxist international economics. However, this construction should proceed from the objective facts of the international economy, adhere to the basic viewpoints, principles, and methods of Marxian economics, and draw upon the scientific components of modern Western international economics to study international economic issues from the broader perspective of the capitalist mode of production. In this regard, Professor Li Chong presenting his own research findings: (1) Regarding the actual causes of international trade, there exist not only absolute and comparative advantages, but also "super-absolute" and "super-comparative" advantages. The latter are the most crucial factors determining the patterns of world international trade and the distribution of interests. (2) Purchasing Power Parity (PPP) theory explains exchange rates solely from the perspective of international trade; therefore, it is necessary to proceed from the value of commodities and the fictitious value [6] of financial assets to analyze the basis of market exchange rate formation from the three perspectives of international trade, international finance, and direct investment. (3) Outward direct investment (ODI) by developed countries is a process moving from domestic production to international production, and from international trade to direct investment. If the benefits of ODI, after deducting risks, are less than those of foreign trade, firms will choose the latter; otherwise, they will choose the former.
Regarding Marxist economic research, Gai Kaicheng of Southwestern University of Finance and Economics argues that, given that modern political economy under the conditions of a socialist market economy should penetrate deep into theoretical assumptions to establish basic ideas and unfold its narrative, it remains necessary to define the economic disposition of "man" at present. One must adjust the analytical paradigms or lines of thought in economics and unify the analytical assumptions of current political economy. Otherwise, the coupling of the two major economic paradigms [7] will lack its most fundamental premise and foundation, let alone achieve breakthroughs or developments in the economic paradigm. Based on a methodological and philosophical foundation of holism, materialism, and realism, Cheng Enfu has proposed an extremely novel basic proposition: the "assumption of the egoistic and altruistic economic man." Using this brand-new theoretical assumption as a guiding principle possesses great theoretical value for realizing the coupling of the two major economic paradigms and achieving the development and breakthrough of modern political economy in the process of this paradigm coupling. He Aiping of Northwest University argues that the trajectory of Marxist political economy research can be roughly divided into two stages: the research and exploration of Marxist economics during the socialist planned economy period prior to Reform and Opening-up, and the research and innovation of Marxist economics during the period of establishing and developing the socialist market economy after Reform and Opening-up. Compared to the pre-reform era, research in Marxist political economy after Reform and Opening-up has broken free from "dogmatic" methods found in traditional political economy research and is actively constructing a new paradigm for Chinese Marxist economic research. In this regard, Professor Cheng Enfu has proposed that the construction of a modern Marxist economic paradigm should be based on the classical Marxian paradigm, oriented toward modern economic and social issues, and informed by the methods and achievements of Western economics. Therefore, theoretical innovation in Marxism and its Sinicization must oppose both dogmatism in traditional political economy research and the dogmatic understanding of Western economics. Yue Hongzhi and Kou Yaling of Northwest University point out that commentators researching Marx’s theory of productive labor—whether belonging to the "broad," "middle," or "narrow" schools—all believe that in Volume I of Capital, Marx studied the so-called "productive labor in general" [8] apart from all social relations and applicable to all socio-economic formations. This has been the persistent traditional and authoritative view in Marxist economic circles. However, this traditional and authoritative view is entirely erroneous. We can reach the following definitive conclusion: in Marx's work, there is no room for the category of "productive labor in general"; Marx did not propose a category of productive labor in general suited to all social formations. Yang Yonghua of South China Normal University argues that the "generalized theory of exploitation," which offers a new interpretation of Marx’s category of exploitation or infinitely expands its extension, is equivalent to extracting the category of exploitation from the theoretical edifice of Marx’s historical materialism. This would certainly damage the entire theoretical edifice of historical materialism. To view everyone in a socialist society as either an exploiter or the exploited is a distortion of socialist society. Hu Shizhen of Jinan University, in analyzing the effect of general wage fluctuations on prices of production, argues that wage changes will cause fluctuations in the prices of production across various production sectors with different organic compositions of capital. However, this only alters the distribution of the newly created value already formed; it will not change the total value of commodities or the total prices of production. If changes in the value of the means of subsistence merely lead to wage fluctuations, they will not thereby alter commodity values or prices of production. Ge Jinghao of Changchun University of Science and Technology argues that, based on Marx’s theory of the connotation of property rights, the reform of China’s property rights system must center on consolidating and developing the basic socialist economic system. We must uphold the right of the broadest masses of the people to the means of production—that is, uphold the fundamental nature of public ownership of the means of production, which is the basis of socialist economic relations. Privatization is not the goal of China’s economic systemic reform.
Chen Shaohua and Guo Guangdi of South-Central Minzu University argue that although certain Western economists give high praise to the significance of Marxian economics, they consistently maintain an oppositional attitude toward his worldview. Western scholars, including Schumpeter and Joan Robinson, "lavished praise on Marx’s achievements, yet consistently maintained a negative attitude toward his labor theory of value." The fundamental reason why Western scholars have increasingly paid attention to and offered more objective evaluations of Marxian economics is that Marx’s long-term dynamic analysis of the capitalist economy has stood the test of history and exerted an important influence on the development of Western economics, which takes the capitalist economy as its same object of study. Consequently, modern Western scholars, even if for the sake of maintaining or saving capitalism, have no choice but to seek counsel from Marx. Guo Junhua and Yang Pei of Northwest University point out that some scholars believe Western economics possesses growth theories while Marxist economics does not. In fact, this is a major misunderstanding. In the history of economic thought, it was Marx who first transformed static analysis into dynamic analysis and short-term analysis into long-term analysis, proposing a systematic and scientific theory of economic growth and establishing economic growth models. In the history of economic thought, Marx’s theory of economic growth inspired Western economists, who only realized they must study economic growth issues after lagging behind for more than half a century. Today, Western economists do not hide the pioneering scientific contributions Marx made to economic growth theory. Wang Lu of Nankai University argues that Marx’s theory of capitalist distribution refuted Say’s "Trinity Formula" of factor distribution and the neoclassical marginal productivity theory of distribution, which imply that "income distribution is determined by the contribution of production factors." On the contrary, it is the specific capitalist relations of production—particularly the capitalist private ownership of the means of production—that determine the distribution of capitalist surplus value.
Wang Jun of Zhongnan University of Economics and Law argues that both Marxist economics and social economics are types of economics that emphasize normative analysis, stress ultimate concerns [9], and focus on human needs and development; both developed on the foundation of classical economics. As a heterodox school of economics, social economics—like other heterodox schools—is known, understood, and researched by few; in China specifically, there is even less introduction and research, and comparative studies between the two are virtually non-existent. Through comparative research, one can better understand the similarities and differences between them, absorb and borrow their rational components, and promote the self-development of Marxist economics. Professor Chen Junming of Fujian Normal University argues that Marx's reconstruction of the category of "income" fully embodies the criticality, creativity, and scientific nature of his theory. That is to say, the category of income is the most concrete category in Capital; it sublated the important determinations [10] contained within commodities, money, capital, and surplus value, and together with them, constitutes the five major categories of the categorical system of Capital. It reflects Marx's scientific treatment of and final return to a complex total object, allowing people to see "a rich totality with many determinations and relations." Starting from the "cell" of bourgeois wealth, it finally returns to the social appearance of the totality of bourgeois wealth itself. Bu Hai of Nanjing Normal University argues that a certain paradigm must be adopted to study the macroeconomy. Currently, the main paradigms for analyzing the macroeconomy in economics are Marxist economics and Western macroeconomics. Because the connotations and logic of the two are not entirely consistent, this can lead to biases or even clear oppositions when observing, analyzing, and grasping the macroeconomy and its development trends. As a unique and evolving conceptual system and analytical method, the economic research paradigm has, through long-term development, formed two major categories: Marxist economics and Western economics. Utilizing different research paradigms to observe and analyze economic problems helps people accurately grasp and reveal the essence, laws, and development trends of the issues under observation from multiple levels and perspectives.
3. Research on Western Economics and Related Issues
Regarding theoretical research in Western economics, Zhang Lin and Bi Ye of Yunnan University argue that research on the economic theoretical foundations of Roosevelt’s "New Deal" mainly revolves around the theme of the Keynesian influence. Orthodox economic literature ignores the significant influence institutionalists exerted on the "New Deal." In fact, by comparing the planning ideas of institutionalists—who were positioned in the core decision-making layers of the New Deal—and particularly their policy propositions and detailed planning schemes with New Deal measures, one can see that the propositions of institutionalists served as the intellectual foundation for reforms in these fields, whether in agricultural adjustment or industrial recovery efforts. As for the financial sector, although representative institutionalists did not participate directly, their ideas were still consistent with the policy goals and many measures in this field. In terms of public works and social relief, the ideas of [J.M.] Clark and [John R.] Commons were directly reflected.
Yang Hutao of Zhongnan University of Economics and Law argues that among many schools of economic thought, the Austrian School appears somewhat "heterogeneous": its views have always been seen as quite similar to the neoclassical school, yet its methodological foundation is far removed; it emphasizes explanation over prediction, yet successfully predicted several economic crises, including that of 2008; it possesses a-priorist and axiomatic orientations, yet opposes all mathematical formalization; most of its views have been absorbed by mainstream economics, but when numerous heterodox schools gather under the anti-mainstream banner of "evolution," it has become a vanguard among them. Guo Guangdi of South-Central Minzu University questioned the tradition of applying the MR=MC marginal principle [11] to the long-term equilibrium analysis of the firm. By separately analyzing the conditions for maximizing the amount of profit versus the rate of profit, he argues that the latter, rather than the former, is applicable in the long-term equilibrium analysis of the firm; thus, the MR=MC marginal principle is only applicable to the short-term equilibrium analysis of the firm. Jiang Dayang of Tianjin University of Commerce argues that at the end of the 20th century, the industrial policy practices of countries and regions such as Latin America and East Asia fully exposed their deficiencies within the pattern of economic globalization, leading to the emergence of neoliberal reforms advocated by the "Washington Consensus." Today, as the "Washington Consensus" has been proven a failure, modern industrial policy exhibits some revolutionary differences from traditional industrial policy: a focus on capacity building, action on both the supply and demand sides, emphasis on enhancing international competitiveness, and leveraging market mechanisms.
Regarding the theory of the state in Western thought, Jiang Yawen of the Department of Economics at Nankai University argued that in comparing the state theories of the three schools of New Institutionalism, it is clear that Historical Institutionalism emphasizes an inductive historicist methodology. However, it fails to provide a definitive account of the origin of the state and places greater emphasis on the significance of endogenous institutional norms regarding the evolution of social systems. Rational Choice Institutionalism is evidently more utilitarian or rational; however, rationality does not always equate to the brilliance of wisdom. To explain the long-term persistence of inefficient institutions and the twists and turns of institutional evolution, this school must resort to the concepts of path dependence or the role of ideology found in Historical Institutionalism. Sociological Institutionalism elevates the influence of culture to a paramount position, where cognitive models and moral templates become almost the sole factors determining institutional choice, and the path of institutional change is nothing more than a borrowing from pre-existing institutional templates. From the perspective of Sociological Institutionalists, culture is viewed as an institution; from the perspective of Rational Institutionalists, it acts as an ideology that exerts a stronger or weaker influence on institutional change. In this regard, Sociological Institutionalism and Rational Choice Institutionalism share significant similarities. Chen Xiaobing of the Hubei Provincial Academy of Social Sciences argued that the factors influencing economic fluctuations and changes in social employment extend far beyond money alone. Consequently, adopting a single-rule monetary policy cannot maintain a normal order of economic growth over the long term; the "monetary omnipotence" advocated by Modern Monetarism is, in reality, a utopia. Song Yu of Northwest University contended that, in the view of Douglass North, the behavioral assumptions of economic agents must transcend the "rational man" [12] hypothesis. While the rationality assumption is useful for a limited range of problems in microeconomic theory, it obstructs a deep understanding of the process of economic change. Much of what we perceive as rational choice is less a matter of individual cognition and more a thought process rooted in a broader social and institutional environment.
Yu Bin of the Institute of Marxism Studies at the Chinese Academy of Social Sciences (CASS) pointed out that Western finance posits the existence of a process called "immunization," which can be used to construct bond portfolios that hedge against interest rate fluctuation risks, thereby shielding the value of a portfolio from interest rate changes. However, investment—especially debt-financed investment—unavoidably involves risk. Attempting to eliminate risk within a market economy characterized by decentralized decision-making is impossible. Furthermore, efforts to eliminate risk based on flawed theories may instead amplify the risks faced by investors. Liu Wen of the School of Business at Shandong University (Weihai) argued that classical Western human capital theory already contains the idea of human capital investment risk. However, the initial theory of human capital investment was developed under the assumption of perfect prediction, failing to integrate risk and uncertainty. It was not until the 1970s that Western scholars began to focus on this issue. Utilizing methods from economics, management, education, and sociology, Western scholars have conducted extensive research on the connotation and causes of human capital investment risk, types of risk, risk premiums, the relationship between investment risk and economic growth, and risk control. They have achieved some useful results in modeling and quantifying human capital investment risk and the resulting problems of investment choice. Domestic research is still in its nascent stage. With the further development of China’s economy and the upgrading and adjustment of the industrial structure, the effectiveness of human capital investment will receive more attention. The importance of investment risk and its attendant problems will become more prominent, which will drive the further development of theoretical research on human capital investment risk in China.
Regarding the proper use of Western economics as a reference, Ren Baoping of Northwest University, having summarized and refined the concepts of wealth held by major intellectual schools in the history of Western economic thought, argued that developing the economy and promoting the growth of social wealth is China's current central task. However, one cannot pursue wealth solely from a material level; one must also seek the "key" to developing material production within the spiritual world. Simultaneously, we must maintain a global perspective and an ethos of advancing with the times. From the perspective of the development of human civilization, we must pay attention to changes in the forms of wealth, maximize the enthusiasm of the people for creating wealth, and ultimately achieve the free and well-rounded development of the individual. Therefore, we must establish a new type of modern concept of wealth from the perspective of human development rather than merely material development. Zhang Ersheng of Hainan University argued that according to the logical assumptions of Western property rights theory, the efficiency of private enterprises is higher than that of state-owned enterprises (SOEs), and the costs of private enterprises are lower, leading to the conclusion that privatization is the best choice. However, through an extensive comparative analysis of Chinese and foreign literature, it is found that this assumption does not hold. It possesses major flaws in both theory and logic; thus, Western property rights theory cannot serve as the theoretical foundation for the reform of China's state-owned enterprises.
On the issue of interest rate "fine-tuning" in macroeconomic regulation, Wang Chunli and Liu Yisheng of the Fujian Academy of Social Sciences and Fujian Normal University argued that by drawing on the successful experiences and failed lessons of the U.S. interest rate fine-tuning model, the specific operation of China's monetary policy must conform to the development of the international economic situation and formulate fine-tuning models suitable for different economic conditions. In practical operation, first, the timing and direction of interest rate fine-tuning must be mastered; second, attention must be paid to the cooperation and coordination of various policies; and third, the building of relevant institutions must be improved. Zhou Xiaoliang and Da Xianliu of Fuzhou University argued that under the mainstream Western economic analytical paradigm, the pursuit of profit maximization by firms is endowed with rationality and unquestionability. However, with the deepening of theoretical exploration and empirical research in recent years, profit maximization faces theoretical confusion and practical dilemmas. To escape these dilemmas, they advocate for the construction of a "generalized profit objective." That is, at the current stage, the goal of the harmonious development of an enterprise should encompass four interconnected and mutually influential objectives: the objective of pure economic profit, development objectives, harmony objectives, and corporate social responsibility. The pursuit of generalized profit objectives by all firms in society constitutes a stable evolutionary equilibrium; therefore, firms that ignore or reject this objective will ultimately be eliminated by the market.
(Author's affiliation: School of Economics and Management, South China Normal University) (Editor: Zhang Qiao)
(Web Editor: Zhang Jian)