Equal Opportunities and the ‘Disinterested Government’
On October 4th a special session of the Political Economy research seminar took place at the HSE Faculty of Economics. Yang Yao, Deputy Dean of the National School of Development and Professor at the Center for Economic Research, Beijing University, spoke about ‘Equality, the Disinterested Government, and Economic Growth: The Case of China’.
— The title of the report sounds paradoxical. What is it about? How can a government not be interested in the successful economic development of its country?
Yang Yao:The concept of a ‘disinterested government’ is not in the lack of interest or willingness to support economic growth in a country, but in the lack of influence over various sectors of society and groups of market players, who compete and seek a government’s support. On the basis of the Stackelberg dynamic model I consider the interaction between a notional government and two citizen groups and prove that a ‘disinterested government’ appears only if both citizen groups have equal political opportunities to initiate and implement changes in the country. Moreover, I believe that social efficiency of any reforms in economics is higher where there is a ‘disinterested government’ than under an authority having prejudices against some of the reformers defending the interests of one or another group. During my lecture I will provide historical evidence that over the last 30 years the Chinese government has been a ‘disinterested government’ mainly thanks to the fact that there was almost no social inequality in Chinese society. In my view, this explains the economic success of China. An example of an antagonistic policy – the policy of an ‘interested government’ is the story of Boris Yeltsin’s victory in the 1996 presidential elections in Russia, when his success was provided by a group of oligarchs to whom he, in return, gave very considerable support.
Kirill Bukin: Professor Yao’s main idea is that a government should be equally distant from the interests of key social groups, such as large companies, medium-sized business and small manufacturers, and should not only avoid putting pressure on them, but not even offer its support. ‘Disinterested government’ is a term used for the definition of real authorities’ neutrality towards different groups of a country’s population, their interests and goals.
— Political and economic changes in Russia started at almost the same time as in China. In your opinion, why has Russia, unlike China, not had much economic success to boast about?
Yang Yao: Economic studies of Russian cases, unfortunately, are yet not in the sphere of my academic interests, but I believe that one of the main obstacles to Russian economic development is the government’s policy of heavy regulation of economic processes in your country. I spent five days in Moscow and found out that the prices in ordinary city cafes and restaurants are surprisingly high. Thinking of the reasons for this, I realized that it is largely connected with the governmental regulation of private businesses, and probably with the presence of corruption which hinders business development.
— Have you come to Moscow at the invitation of the Higher School of Economics?
Yang Yao: Yes, my visit is the first part of the programme of collaboration between the HSE and Beijing University. Mark Levin, Head of the HSE Faculty of Economics Department of Microeconomic Analysis, will come to Beijing in early November for a return visit to read lectures on corruption in Russia.
Kirill Bukin: We do not yet have an agreement on the collaboration between our universities, but we are not going to limit ourselves only to exchange programmes for lecturers and researchers. Our colleagues in China have developed a world-class doctoral programme, so students on our new academic postgraduate programme will be able to have research internships there.
Valentina Gruzintseva, HSE News Service
Photo by Polina Frolova