Sho-Chieh Tsiang

Sho-Chieh Tsiang (traditional Chinese: 蔣碩傑; simplified Chinese: 蒋硕杰; pinyin: Jiǎng Shuòjié; August 25, 1918 – October 21, 1993) is a Chinese-American economist. He was born in China but resided primarily in the United States from 1949 until his death. He also resided in Taiwan in 1948 and in the 1980s.

He was the father-in-law of Lars Peter Hansen (2013 Nobel Prize in Economics laureate).

Life and career

He studied at London School of Economics (B. Sc. Economics 1941, Ph.D. Economics 1945) under Friedrich Hayek and received the Hutchinson Silver Medal 1944–45.^[1] He served as Professor of Economics at National Peking University, 1946–48, staff economist at the International Monetary Fund, member of Academia Sinica, and Professor of Economics at University of Rochester and Cornell University. He was Director of the Chung-Hwa Institute for Economic Research during the 1980s.

Tsiang's academic contributions include work on the demand for money, monetary theoretic foundations of the monetary approach to the balance of payments, an early statement of the relation between spot and forward exchange rates, and the role of money in trade balance stability. However, together with his lifelong friend and colleague Ta-Chung Liu, also a professor at Cornell University, gave practical advice to the Republic of China on economic policy. Together they advocated against central planning and for creating an environment that encouraged private enterprises to compete on world markets. They were able to convince members of the government, such as Economic Minister, Kwoh-Ting Li of the soundness of their views. Their advice was implemented, beginning with foreign exchange reform in beginning in 1958. Tsiang advocated the unification of multiple exchange rates and the devaluation of the New Taiwan dollar from artificially overvalued levels. Understanding that Taiwan at that time had cheap labor relative to the world market, he advocated for a liberalization of interest rate controls to promote savings and produce funds for investment for small enterprises, and proposed low tariffs to encourage exports. In this way, Taiwan could exploit its comparative advantage in labor-intensive goods on the world market. This was counter to prevailing policy recommendations by economists of the day, for whom "import substitution" was a common policy prescription where subsidization of domestic heavy industry was seen as a fast track to modernization. He also wrote for the public audience in Taiwan, engaging in lively public debates while director of the Taiwan Institute for Economic Research and later, the Chung-Hua Institution for Economic Research.

Selected writings

• Tsiang, S.C. "The 1951 improvement in the Danish balance of payments." IMF Staff Papers, vol. 3, 1953, pp. 155–170
• Tsiang, S.C. "Liquidity preference and loanable funds theories, multiplier and velocity anlysises: a synthesis," American Economic Review, vol. 46, 1956, pp. 539–64.
• Tsiang, S.C. "The Theory of Forward Exchange and Effects of Government Intervention on the Forward Exchange Market", 1959, IMF Staff Papers.
• Tsiang, S.C. "The precautionary demand for money: an inventory theoretical approach", Journal of Political Economy, vol. 76, 1968.
• Tsiang, S.C. "Taiwan's economic miracle: lessons in economic development," in A.C. Harberger, editor, "World Economic Growth; Case Studies of Developed and Developing Countries," Institute for Contemporary Studies, San Francisco, CA, 1984.

References

Further reading

• Krueger, Anne O. (1997). "Trade Policy and Economic Development: How We Learn". American Economic Review. 87 (1): 1–22. doi:10.3386/w5896. JSTOR 2950851. 
• Lau, Lawrence J., "In Remembrance of S.C. Tsiang, A Scholar and a Gentleman" CIER Newsletter, 2:2 1994.
• Nasar, Sylvia (November 25, 1993). "Obituary: S. C. Tsiang, an Economist, 75; Helped Guide Taiwan's Economy". New York Times. 
• Wang, Lutao Sophia Kang. "K.T. Li Kwoh-Ting Li and the Taiwan Experience." National Tsing Hua University Press (2006)