Manufacturing Policy Memo Due Wednesday 6 November 2013
Write a policy memo addressed to China’s top leader. Address how you believe rules and regulations should be structured. Take one of the following two polar positions. You may argue the third status quo option, or some other specific set of policies, but that will be challenging to do in a short memo.
– as a “strategic” industry entry should be restricted to “domestic” companies, in both assembly and parts manufacturing. existing joint ventures should be asked to buy out their foreign partners; sole ventures should be asked to sell their factories to (initially) joint ventures; tariffs on imports should remain high.
– to enhance competitiveness, all barriers and restrictions on ownership, imports should be removed and tariffs lowered.
– maintain the status quo of a mix of tariff barriers and entry restrictions in the most politically salient part of the industry, final assembly.
Your memo needs of course to very briefly argue the costs and benefits to the Chinese economy as a source of employment, to consumers [vehicle purchasers], and (if you so choose) to politicians or other narrower interest groups or policy issues. Remember, in a memo you can’t argue everything. You do however have to argue something.
Excluding headers (format it as a memo!) you may use no more than 700 words, which if you single-space lets you put the memo on one page. Indeed, put your memo in that format – but then put it again in standard double-spaced format so I can correct it. Do not put in citations or page numbers; that’s not the memo format. Instead, if you use outside sources, add a paragraph noting those following the memo itself.
Feel free to get together with classmates to discuss this assignment. The memo however should be your own.
—Due in class on Wednesday, 6 November, 2013—
For those who are interested in economic development, the first of these options is the pure form of an “Import Substitution Industrialization” strategy; the second is the “liberal market” policy, sometimes termed an “Export Promotion Growth” strategy.