Yasheng Huang: What Worked With Japan Won’t Work With China

MIT Sloan Prof. Yasheng Huang

From the New York Times

In the 1980s, the United States threatened sanctions if Japan did not reduce its trade deficit. One consequence — intended or unintended — was that Japanese investments in the United States increased dramatically in response to the punitive sanctions.

These are called “tariff-jumping” investments and today there are commentators who call for similar policies to get the Chinese to switch from exporting to the United States to investing in the United States. Apple features prominently in this debate because the company has outsourced almost all the manufacturing of its popular products to China.

Read the full post at NYT Room for Debate

Yasheng Huang is International Program Professor in Chinese Economy and Business Professor of Global Economics and Management. He is the author of “Capitalism With Chinese Characteristics”