86
5 Genie Out of the Bottle
even though top-down control might accelerate decision-making, it is questionable,
whether the resulting decisions would be better and sustainable, too.
2 If we implemented the Chinese approach in Europe or the USA, we could easily decide to build
a road over here, a shopping mall over there, and even new city quarters or entire
towns. Moreover, these projects could be realized in just a few years. This may sound
tempting to decision-makers. However, when space and other resources are limited,
improving a system becomes increasingly difficult as it evolves: Given the many
interdependencies, improvements in one part of a system may come with undesired
side effects in others. Over time, many decisions will turn out to be less favorable than
expected, and quick decisions will often result in mistakes. For example, there are
many “ghost malls” in China, which almost nobody wants to use, and empty “ghost
towns”, too. Moreover, environmental pollution has become a serious issue. Some
cities are now suffering from smog levels that imply considerable risks to health and
make them almost dysfunctional.
Even though China has quickly developed, it should also be considered that the
satisfaction of its people hasn’t everywhere increased. Social unrests are frequent.
Due to the world economic crisis, China is now even confronted with a dangerous
reduction in its growth rate and financial turmoil, so that it must reorganize its
economy. To reduce the likelihood of a revolution, information flows to and from the
country are increasingly controlled by the government.
In other words, China shows worrying signs of destabilization.
3 India’s democracy, in contrast, is doing increasingly well.
4 Also in Europe, federally organized
systems such as Germany and Switzerland are performing better than more centrally
governed countries such as France. In fact, it can be said that the most advanced
economies in the world are the most diverse and complex economies.
5
2 A recent data analytics study performed in my team shows the following: The transition from
autocratic to democratic governance can fuel economic development (probably because free
entrepreneurships allows new products, services, and business models to come up). Eventually,
however, the growth rate slows down. Those countries that have then turned to top-down governance tended to have an initial economic boost (which is probably due to a streamlining of society
at the cost of diversity). However, on the long run, such a transition doesn’t pay off. On the contrary,
the price for it is high (probably because a loss of diversity reduces innovation rates).
3 Based on a statistical analysis of Jürgen Mimkes, China will now undergo a major
transformation towards a more democratic state in the coming years. First signs of
instability of the current autocratic system are visible already, such as the increased
attempts to control information flows. The following recent articles support the conclusion regarding increased instability in China (please use, for example, Google Translate where needed): https://www.chinausfocus.com/society-culture/instability-and-unpredictabi
lity-in-china-the-new-normal; https://www.sciencedirect.com/science/article/abs/pii/S1043951X
13000035; http://www.zeit.de/politik/ausland/2015-03/china-wachstum-fuenf-vor-acht; http://baz
online.ch/wirtschaft/konjunktur/China-uebernimmt-die-rote-Laterne/story/20869017.
4 Why India will soon outpace China, see http://www.forbes.com/fdc/welcome_mjx.shtml and
http://www.economist.com/news/business-and-finance/21642656-indias-economy-grew-faster-chi
nas-end-2014-catching-dragon.
5 Hidalgo et al. [2].
5 Genie Out of the Bottle
even though top-down control might accelerate decision-making, it is questionable,
whether the resulting decisions would be better and sustainable, too.
2 If we implemented the Chinese approach in Europe or the USA, we could easily decide to build
a road over here, a shopping mall over there, and even new city quarters or entire
towns. Moreover, these projects could be realized in just a few years. This may sound
tempting to decision-makers. However, when space and other resources are limited,
improving a system becomes increasingly difficult as it evolves: Given the many
interdependencies, improvements in one part of a system may come with undesired
side effects in others. Over time, many decisions will turn out to be less favorable than
expected, and quick decisions will often result in mistakes. For example, there are
many “ghost malls” in China, which almost nobody wants to use, and empty “ghost
towns”, too. Moreover, environmental pollution has become a serious issue. Some
cities are now suffering from smog levels that imply considerable risks to health and
make them almost dysfunctional.
Even though China has quickly developed, it should also be considered that the
satisfaction of its people hasn’t everywhere increased. Social unrests are frequent.
Due to the world economic crisis, China is now even confronted with a dangerous
reduction in its growth rate and financial turmoil, so that it must reorganize its
economy. To reduce the likelihood of a revolution, information flows to and from the
country are increasingly controlled by the government.
In other words, China shows worrying signs of destabilization.
3 India’s democracy, in contrast, is doing increasingly well.
4 Also in Europe, federally organized
systems such as Germany and Switzerland are performing better than more centrally
governed countries such as France. In fact, it can be said that the most advanced
economies in the world are the most diverse and complex economies.
5
2 A recent data analytics study performed in my team shows the following: The transition from
autocratic to democratic governance can fuel economic development (probably because free
entrepreneurships allows new products, services, and business models to come up). Eventually,
however, the growth rate slows down. Those countries that have then turned to top-down governance tended to have an initial economic boost (which is probably due to a streamlining of society
at the cost of diversity). However, on the long run, such a transition doesn’t pay off. On the contrary,
the price for it is high (probably because a loss of diversity reduces innovation rates).
3 Based on a statistical analysis of Jürgen Mimkes, China will now undergo a major
transformation towards a more democratic state in the coming years. First signs of
instability of the current autocratic system are visible already, such as the increased
attempts to control information flows. The following recent articles support the conclusion regarding increased instability in China (please use, for example, Google Translate where needed): https://www.chinausfocus.com/society-culture/instability-and-unpredictabi
lity-in-china-the-new-normal; https://www.sciencedirect.com/science/article/abs/pii/S1043951X
13000035; http://www.zeit.de/politik/ausland/2015-03/china-wachstum-fuenf-vor-acht; http://baz
online.ch/wirtschaft/konjunktur/China-uebernimmt-die-rote-Laterne/story/20869017.
4 Why India will soon outpace China, see http://www.forbes.com/fdc/welcome_mjx.shtml and
http://www.economist.com/news/business-and-finance/21642656-indias-economy-grew-faster-chi
nas-end-2014-catching-dragon.
5 Hidalgo et al. [2].