Professor Evan Osborne, a Fulbright Scholar who received his M.A. and Ph.D. in Economics from the University of California at Los Angeles, spoke recently at ICLP concerning troubling trends that he sees within the Chinese economy. Professor Osborne, who is an alumnus of ICLP, has been teaching at Wright State since 1994.

　　Concerning the Chinese real estate market, Professor Osborne sees a bubble beginning to pop. He discussed the Chinese government's recent massive infrastructure investments, including building roads that lead to nowhere, as well as the many unoccupied apartment complexes that dot the Chinese landscape. In the near future, Professor Osborne foresees a "substantial correction" with a possible 30% reduction in real estate prices. If this were to occur, he noted that public finance at the local level would be left facing substantial revenue shortages since Chinese local government revenue is directly tied to local real estate tax revenue.

　　The second major issue Professor Osborne focused on during his speech concerned innovation within the Chinese economy and society. The infrastructure and advanced technological equipment necessary for innovation is becoming more and more available within universities and in other settings in China. The answer to the question of whether or not Chinese society is ready and willing to deal with the constant change that comes with an innovative society is still unknown. However, it was brought up during the question and answer portion of the speech the differences between the older generations and new ones in China. These differences suggest, in part, that at least the new generations might be willing to break with tradition.

　　Overall, Professor Osborne sees no long-term difficulties, but feels the Chinese economy is heading for a recession in the short run.