USC Annenberg

Interview with professor Yu Hong by Mina Park

If you are interested in China’s economic reform, you might want to look at professor Yu Hong’s work. Hong is working on a book about the role of Chinese government in domestic industry development.

“I wanted to understand how the state goes along with other domestic forces to create a bigger developmental space for the country," Hong said. "This book focuses on China’s renegotiation with global capitalism.”

 “People do not pay much attention to the relationship between telecommunication and broader economic development.”

The first chapter focuses on explaining how telecommunication facilitates China’s economic reform. Unlike most of the countries in the world, all of the telecommunication operators are owned by the state. This is a unique situation and it is important to look at how China controls these crucial assets to achieve economic reform. According to Hong, however, people do not pay much attention to the relationships between telecommunication and broader economic development. Therefore, she looked at mobile phone industry to explain China’s opening up and telecommunication.

The second chapter talks about changes in China’s developmental strategies over the past three decades. China was introduced to foreign capital early on and domestic companies did not have enough time and space to grow. As China has tried to cultivate endogenous innovation capacities, many domestic industries have been developed over time. In this article, Hong specifically analyzed how China supported domestic mobile industries from the historical perspective.

“China realized that they needed to turn culture into business because the culture industry was one of the service industries where China had little power.”

The third chapter deals with China’s culture industry. In China, the culture industry including TV stations, radio stations, newspapers, and all other party/public institutions used to be a non-profit sector and they were sponsored by the state budget before market reform. After the global economic crisis, however, China realized that they needed to monetize culture. Thus, China started to cut financial support to these cultural institutions and ask them to be more self-reliant and commercially viable. Professor Hong describes how China maneuvers the State-controlled resources in order to create domestic demand.

Other chapters deal with the struggle between transnational capital, local states, and local capital, Chinese broadband, and Internet governance.