What happens when Chinese resolve meets American rent-seeking?
a day ago
- #political economy
- #institutional pathology
- #comparative systems
- The text discusses the comparison between American rent-seeking and Chinese resolve, highlighting the pathologies in both systems.
- It references two books: 'Abundance' by Ezra Klein and Derek Thompson, and 'Breakneck' by Dan Wang, which critique the regulatory and engineering states respectively.
- The post-Reagan era in the USA led to a privatized regulatory state where rent extraction became prevalent, as discussed in 'The Captured Economy' by Brink Lindsey and Steven Teles.
- China's 'engineering state' has driven rapid industrialization but suffers from blunders due to poor listening and correction mechanisms.
- The text warns of a potential future where a state combines Chinese myopia with American rent extraction, leading to systemic failures.
- It emphasizes the difficulty in reforming institutions before their failures become manifest, using Greece's debt crisis as a cautionary tale.