The Beijing Cairncross Economic Research Foundation and the National School of Development of Peking University jointly held the “Cairncross Foundation Annual Lecture” on November 6, 2015 at Peking University, Beijing.
Tim Besley is School Professor of Economics and Political Science and W. Arthur Lewis Professor of Development Economics at the London School of Economics. He served on the Bank of England's Monetary Policy Committee from September 2006 to August 2009. He is a member of the Institutions, Organizations and Growth Program of the Canadian Institute for Advanced Research and his research interests are focused on aspects of economic policy formation. He is a Fellow of the British Academy and the Econometric Society and is a foreign honorary member of the American Economic Association and the American Academy of Arts and Sciences. He is also a past co-editor of American Economic Review and has served on the board of numerous academic journals. In 2010 he served as president of the European Economic Association and as President of the International Economic Association in 2014-17. In 2005, he won the Yrjö Jahnsson Award for European economics. He received his doctorate in Economics from the University of Oxford where he was a Prize Fellow at All Souls College.
Lecture Summary. There have been two major changes in thinking among economists in the past thirty years: a greater appreciation of the role of state effectiveness in shaping economic progress and the role of institutions in underpinning long-term success. China’s economic progress has been a major influence on thinking in these areas. From the mid-1980s onwards, a more market-oriented approach to economic policy was pursued but with a strong supporting role of the state. This confounds the standard dichotomy between market-led and state-led development, and emphasizes the importance of achieving a balance. This lecture will look at how the supporting role of the state can be enhanced through building state capacity and the role of economic governance in supporting this. It will review the global and historical experience. It will also discuss how good governance can enhance responsiveness to shocks, creating greater stability. It will take the example of how policy makers responded to the crisis in the UK to illustrate these challenges, drawing lessons for China as it builds its state capacities.