For immediate release
Contact: Anthony Flint 617-503-2116
CAMBRIDGE, Mass. (April 8, 2010) – The Peking University–Lincoln Institute Center for Urban Development and Land Policy in Beijing hosted lectures on worldwide financial tumult, smart growth, and economic growth models, identifying some common themes for the U.S. and China in urban planning and public finance.
At “Smart Growth and Economic Growth Models” hosted at the center, on the campus of Peking University on March 12, Gregory K. Ingram, president of the Lincoln Institute of Land Policy, summarized the recent report Smart Growth Policies, a comprehensive evaluation of statewide smart growth policies that showed the challenges of achieving objectives in containing sprawl, expanding transportation options, and maintaining affordable housing. He noted the importance of regional collaboration, careful policy design, and better evaluation mechanisms to improve the effectiveness of smart growth policies, particularly now that many land use and transportation policies have become part of efforts to reduce greenhouse gas emissions.
Also at the event, Fu Jun, Dean of the Peking University School of Government, explained the theory behind his recent book Guofuzhidao, which holds that a nation’s wealth is determined by the interplay between the effectiveness of its bureaucracy, which should be based on meritocracy and include strong checks on power, and the efficiency of its markets, which needs to provide personal incentives and property rights. Applying the theory to China’s current development, he identified underdeveloped market institutions that may hamper economic growth.
At “China and U.S. Economic Recovery: Responses and Challenges in the Face of Financial Crisis” on March 26, Lincoln Institute Fellow Yu-Hung Hong provided the Beijing audience with an overview of the U.S. subprime mortgage crisis and its implications for local public finance. Municipal governments have turned to non-conventional debt-financing mechanisms, such as asset transfer and asset construction certificates of participation, to offset declining revenues from property taxes and intergovernmental transfers, he said. While there is no ideal fiscal instrument to replace dwindling revenue streams, increasing or adding local sales taxes have typically been the most effective and politically acceptable solution.
Joyce Man, the director of the center, offered an overview of how expansionary monetary policies and low interest rates designed to stimulate the economy after the 2001 recession later contributed to real estate and credit bubbles. Comparing U.S. and Chinese policy responses to the credit crisis, she noted China’s use of monetary and fiscal policies similar to those employed by the U.S. in the past to stimulate the economy, and cautioned that continued reliance on such policies may further increase both housing prices and local public debt in China.
The Lincoln Institute of Land Policy is a leading resource for key issues concerning the use, regulation, and taxation of land. Providing high-quality education and research, the Institute strives to improve public dialogue and decisions about land policy. The Peking University–Lincoln Institute Center for Urban Development and Land Policy was established in 2007, in association with the institute’s extensive Program on the People’s Republic of China.
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