Video On Demand

China Reality Check Series: Subsidies to China's Industry

June 13, 2013 • 6:30 – 8:00 pm EDT

Why They Matter and What We Should Do

The Freeman Chair in China Studies cordially invites you to:

The CSIS China Reality Check Series

Made possible by generous support from Patriarch Partners on  

Subsidies to China's Industry:
Why They Matter and What We Should Do

With commentary by:

Dr. Usha C. V. Haley 
Professor/Director, Robbins Center for Global Business and Strategy, West Virginia University  

Dr. George T. Haley
Professor/Director, Center for International Industry Competitiveness, University of New Haven  

Moderated by:

Christopher K. Johnson
CSIS Senior Adviser and Freeman Chair,  Freeman Chair in China Studies

How did China move swiftly in capital-intensive industries without labor-cost or scale advantage from a bit player to the world's largest manufacturer and exporter, and why have so many industrialized countries become exporters of commodities and scrap to China?  What are the implications of these developments for business strategies and national competitive advantage? The authors of “Subsidies to Chinese Industry:  State Capitalism, Business Strategy and Trade Policy,” Usha C. V. Haley and George T. Haley argue that subsidies contribute significantly to China’s success. Economic theories portray subsidies as distortive, inefficiently reallocating resources according to non-market criteria. However, China’s state-capitalist system uses subsidies to promote the Chinese Communist Party's long-term objectives. The authors explore industry studies on steel, glass, paper, auto parts and solar to trace the growth of Chinese subsidies over time and its effect on world industry.