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The next Nobel Prize Winner: Justin Yifu Lin


It was 1978. Our economists were messing around at Bocconi University. Lawrence Summers bit into a cheeseburger. Giulio Tremonti hadn't yet forecast the crisis. Justin Yifu Lin reached China by sea; that is, he swam there.

Justin Yifu Lin is the current Chief Economist and Vice President of the World Bank. With Robert Zoellick he is one half of the pair of the globalization institutions most in line with the idea of the G2, the multiple tenancy/workshop between China and the USA to manage the big questions of the global economy and politics. Zoellick and Lin: one American, the other Chinese. With solid experience (one with law studies at Harvard Law School, followed by a Master's in Public Policy at the Kennedy School of Government, the other with a PhD in Economics from the University of Chicago), both men put their names to a co-written article in the Washington Post in March, linking the stability of the recovery with Chinese and US responsibilities in the new financial order. Compared with the acumen of Zoellick, who coined the expression “responsible stakeholder” as regards China in 2005, the hole-ridden socks of his predecessor Paul Wolfowitz really cut a poor figure. Lin is the first representative of a developing country to hold such an important role, despite the totally Chinese paradox of the concurrence of the businesses that are still developing and the runaway evidence of the economic and political superpower.

Justin Yifu Lin, nevertheless, has something that distinguishes him from Zoellick and all the other directors – more or less transatlantic – who are at the top of institutions awaiting a new agreement between the already developed countries (which are currently struggling) and developing countries that have now emerged. This something is linked to his swim. In a previous life, Lin found himself on the side of Taiwan. He had already obtained an MBA from National Chengchi University when he deserted the army (he was a promising officer), swimming in fact from the island of Jinmen to the coast of the Fujian Province. After those two kilometres of front crawl, he began a new life in the China of Deng Xiaoping, with a Master's in Marxist Economics from the prestigious Peking University. In 1980 he had the opportunity to work there as a translator for the Nobel Prize Winner in Economics, Theodore Schultz, from the University of Chicago, who arranged for Lin to obtain his PhD in the USA. Yes, actually in Chicago. In China (where he founded and managed the China Centre for Economic Research, Peking University), he then had the chance to be reunited with his wife. However, he wasn't able to attend his father's funeral and he still hasn't set foot back in Taiwan, where a capture order for desertion awaits him, with the risk of provoking the umpteenth diplomatic incident between the island and the motherland.

As a scholar, the uniqueness of Justin Yifu Lin perhaps lies in comparing apparently incomparable worlds without awe. He has obviously focused his attention on the development processes of China. On one hand, with studies on the agricultural economy, in view of the improvements in its efficiency, central to the process of reform that got underway at the end of the 1970s. On the other hand, he hasn't pooh-poohed inroads into wider perspectives, arriving at the Needham Puzzle, on the trail of the research into the economic ethics of the religions of Max Weber. The question that is still debated among economists and historians is, why Europe and not China? How come China missed the boat with industrialization and wasn't able to get onboard for centuries so it ended up suffering being cast aside from Western powers and Japan in the “century of humiliation”, which preceded the birth of the almost 60 years of the People's Republic of China? What was the cause of that technological gap that continued to plague the world's most populous country under the aegis of Chairman Mao?

Sun Yat Sen, the father of modern China, had repeatedly insisted upon the importance of technology for development, and the dilemma of learning Western technology certainly typified the People's Republic of China. Lin, in the wake of institutional economics, elaborated upon the concept of industrial and technological “learning”, combining it with the ideas of Deng Xiaoping. According to Deng (whose epigraph now stands out in the papers of the World Bank), moving from a planned economy to a market economy was like crossing a river on stepping stones. This “pragmatic learning”, on account of the ability to make up for the ongoing errors and to integrate its comparative advantage in the processes of the global economy, certainly contributed towards creating what we now call the Chinese miracle. We should point out that, according to the (albeit criticised) statistics of the World Bank, we are talking about 600 million people escaping abject poverty

In 2007, before being appointed to the World Bank, the former soldier turned great economist received the final mark of approval, with the invitation of Cambridge University to hold the prestigious Marshall Lectures, on the subject of ‘Development and Transition: Idea, Strategy, and Viability' (now a volume published by Cambridge University Press). Suddenly, the observations of Zhou Enlai and Jawaharlal Nehru were interchanged in the corridors where Keynes had walked.

In short, setting aside his legendary status, we should consider the journey of Justin Yifu Lin in detail to understand some of the world's trajectories after the crisis. Here are some observations and a final challenge as regards the economic and political plan.

Firstly, Lin is a member of the party in which he has had important roles. His university research centre certainly has close relationships with the government. His profile is an example of the critical objection on the underestimation of the power of the Communist Party, which Wang Jisi, Dean of the School of International Studies, Peking University, brought up at the idea of the Bejing Consensus developed by Joshua Cooper Ramo.

Secondly, for the Chinese economist, the role of representation does not in any way obscure his research (for which, incidentally, Lin could also become the first Chinese Nobel Prize Winner in Economics after having received the Sun Yefang Prize twice). At the same time, the role of representation in the world after the crisis has a certain importance, especially in Asian countries, in which Lin had a heavy stake in reinterpreting the experience of the crisis in Southeast Asia, beginning with the current crisis, and particularly in African countries. He also remarks on this in his research. Take, for example, the paper ‘China's Integration with the World. Development as a Process of Learning and Industrial Upgrading', published with Yan Wang at the end of 2008 and available on the World Bank website. In this essay, as in others, the Chinese example usually turns into “lessons for Africa”. When we talk about “Chinafrica” and the hunt for the “dragon's” resources, we mustn't underestimate this aspect, which Lin explicitly links to a development strategy in the South-South cooperation in terms of the perhaps overly ambitious prospect of a “global Marshall plan”.

Thirdly, it's evident that some of the main questions of our time lie behind the journey of one, albeit exceptional, individual, questions in which Italy and Europe seem to take no interest. For example, is the West (supposing it exists) losing and will it also lose on the talent plan? Is the People's Republic of China (which certainly exists, supposing that it remains united and under the control of the Communist Party) winning and will it win? These questions are perhaps too general to receive a single correct answer, like the question “Why the West and not China?”, but today we certainly have a lot to learn from Justin Yifu Lin if we don't want to find ourselves left out on the edge of the next empires of knowledge.