The modern world of art offers fascinating insights into the forces currently shaping world trade and the global economic system. For decades, China has experienced breakneck economic growth and has become a world leader in both the consumption and production of art, which illustrates some intriguing changes in the global economy.
The global market for high-end, rare art pieces is a good example. In recent years, as China grew more prosperous, there has been a sharp uptick in luxury art purchases by Chinese customers. In 2016, according to insider information, Oprah Winfrey sold a 54”x54” painting to a Chinese collector for $150 million. This example indicates how China has grown in its appreciation of originals. This shift perhaps presages an eventual reduction in counterfeit products for which China is still infamous. Chinese auction houses have also risen to prominence. Of the world’s top ten art auction houses, six are Chinese, and many of the largest art houses are state-owned enterprises.
In the art world, China has not only become a dramatic consumer of art, but also a prodigious producer. The southern Chinese city of Dafen, nearby to megacity Shenzhen which borders Hong Kong, has become the center of knock off art masterpieces. Beginning in the 1980’s reform era, Dafen became a hub for starving artists from around the country to work and train, pumping out high-quality knock-offs of famous European and American painters ranging from van Gogh’s Sunflowers to portraits of Western icon John Wayne. Artists produce these works on the cheap and can offer custom alterations, such as changes to the color or size to fit the purchaser’s own décor. Since the works are not signed, they do not count as fakes.
The producers of export knock-off masterpieces will face pressure to adapt, focusing more on creativity and original works. When Chinese artists copy the great masters, they hone their skills and imagination, which over time will allow them to eventually emerge as new artists in their own rights
World trade has forged a network of global linkages, in which everyone and every country is involved. Nowadays, a drought in Brazil and its effect on coffee production and prices is felt around the world. U.S subsidies for ethanol production from corn affects prices for other agricultural crops and livestock in the far reaches of the world. As the key player in globalization, any U.S reform tends to change the international market. The old saying goes, if the U.S. sneezes, other nations catch a cold.
After only 100-days in office, President Trump has already released a tax reform memo to the public. Although not complete and detailed, there is clear a signal coming from the release how the government would like to encourage U.S companies to export and invest abroad.
First, comes a cut in the top tax rate for all businesses to 15%, far below the current 35% top rate. This reduction is not imbalanced since it would also benefit the owners and shareholders of international corporations in the United States. With this tax cut, companies, especially manufacturers, can lower the price of exports and have more money for R&D and marketing. This measure will greatly enhance the competitiveness of U.S goods in the global market. Also, a tax reduction will significantly reduce the financial constraint on companies and allow American companies to seek investment opportunities on a global scale.
The changing composition of U.S. trade
We have often heated discussions on trade policy shifts. To make reasonable arguments, we must consider that the fundamental composition of trade has been changing. For example, from the 1960s to 1990s, the trade role of primary commodities has declined precipitously while in parallel, the importance of manufactured goods has increased. This has meant that those countries and workers who had specialized in commodities such as rubber or mining typically fell behind those that had embarked on strengthening their manufacturing sector. With sharply declining world market prices for commodities and rising prices for manufactured goods, commodity producers were increasingly unable to keep pace. Some commodity-dependent countries realized temporary windfalls as prices of oil, wheat, and corn rose dramatically, only to watch them evaporate as prices dropped in 2009.
On February 18th, our class got the pleasure of having a distinguished guest speaker Ms. Anabel Gonzalez, Senior Director of World Bank Group Global Practice on Trade and Competitiveness . We are very grateful for the inspiring thoughts and valuable experiences she shared with us.
The World Robot Conference will be held in Beijing this year from Nov. 23 to 25, focusing on the building of an intelligent society and collaborative innovation. The number of industrial robots sold in China reached 57,000 last year, which marked an increase of 55 percent on a year-on-year basis and one-quarter of global sales.
The government is drafting a plan to boost China’s robot research, development and application in key manufacturing fields, and to improve the country’s inadequate capacity to produce high-end robots independently.
The event will comprise a forum, an exhibition and an international robot competition for teenagers. More than 40,000 participants are expected.Speakers from China, Germany, the United States and Japan will deliver reports on such topics as robot research and technology development. An exhibit will be held featuring the latest products, while research findings will also be showcased during the three-day event. There are 130 teams aged 8-15 from around the world attending the World Adolescent Robot Contest (WARC 2015), where children will compete using Lego robots with each other.
I believe that robots will be the next revolution in technology just like PCs, cell phones or tablets. The robots will be part of our daily life, and one day, we wouldn’t be able to imagine our life without one. Robots become so simple that even children are able to build them for international competitions. The next revolution consists of robots, and is already in front of the door or has already entered without us noticing… maybe later on we can tell our grandchildren that we discovered the new Steve or Stephanie Jobs at the conference.