The CoStone Reader Recommends Vol. 6



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The Mystery of Capital

By Hernando de Soto

    Why the economic system of capitalism prevailed in the West, but stagnated in many developing countries? A question has been daunting many economists and sociologists. Developing countries seem like the outsiders in the capital market. The harder they try, the harder they can get invited. Hermando Soto found the answer. He believes that most developing countries are devoid of a mature mechanism to turn assets into capital. Therefore, they crave for capital. He illustrates five mysteries about why advanced capitalism failed in the developing countries. The mysteries of data missing, unknown capital support, political awareness, historical sensitivity and inadequate legislation in the book reveal the secrets of capitalism.

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Debating the Chinese Model

By Ding Xueliang

    China made a substantial fortune since reforms and opening up and claimed to the world that “Chinese Model” worked. At the fortieth anniversary of reforms and opening up, we are able to take a breath and review the gains and losses. The book, “Debating the Chinese Model”, provides sharp and critical insights on “Chinese Model”. The definition, external and internal drivers, effect and price of “Chinese Model” are expounded in this book. It proposes an alternative when the Model bailed out. The author points out the hinderance and meanings of the alternative. His acute and profound analysis on the Model are illuminating for the readers.


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Revolution in the “Intermediate Zone”-success of the Community Party of China

By Yang Kui Song

    The author shares his perspectives on the evolution of the Communist Party of China. It provides a set of systematic analysis on how and why the Communist Party of China could grow during the revolutions. Suffered from the second world war, the Party failed twice and was left weak after that. How a fragile and weak party developed into a strong and vigorous one and finally united the whole China? The answer can be intriguing. This book explains the essential decisions made by the Party to step into power and the internal and external forces that affect them.



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People of the Republic of China

By Yang Kuisong

    The author sheds a different light on the history of the Republic of China. His light writings depict a vivid picture of that era for readers. These writings, including papers, essays, reading notes and speeches, are light but not loose. The author utilizes plain words in his writing which brings before the readers vividly many historic figures and events. This is a good place where you can spend your time.



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Past and Present: Interviews on the History of the Communist Party of China

By Yang Kuisong

    The author, Pr. Yang Kuisong, illustrated the problems, status quo and methods of the history of the Communist Party of China. He shares his painstaking as an expert on Chinese modern history. His concerns and respect for mankind sprinkle throughout his words and phrases in this book. Though he excels in digging into historical phenomenon and conducting empirical research, he offers his own insights on China’s modern history, revolutions and the history of the Communist Party of China. Every critical historic event is revitalized by his unique writings and comments.

Rewritten by: Luo Xinying, Edited by: Du Zhixin, Wei Yiyi

The year 2019 marks the fortieth anniversary of China’s Reform &Opening-Up, once again, we meet at the turning point of history. What’s the next step for the game, is there any clear guidance? The answer is affirmative.

Our country is enjoying a good momentum of development, which does not come from the Washington Consensus nor the Beijing Consensus. China’s experience has proved that both the visible hand and the invisible hand are crucial: the visible hand, stands for the government-led reform, and would yield benefits for reform and opening up; the invisible hand, stands for the Marginal Power represented by the private sector, and would improve economic efficiency and tax collection, create jobs and employment opportunities.

Provided that we want to protect and expand the benefits form reform, three simple but mandatory agreements are to be made and followed: No.1 Private ownership must be recognized, protected and treated equally with public ownership constitutionally, both ownerships are scared and inviolable;No.2 Make further clarification of the principal position of market economy, “deepen economic system reform by centering on the decisive role of the market in allocating resources”, as President Xi addressed in the third Plenary Session of the 18th CPC Central Committee;No.3 Implement the guiding principles of “comprehensively promoting law-based governance” of the fourth plenum. The rule of law is essential for economic growth, irreplaceable to protect private ownership, and necessary to encourage innovation and entrepreneurship.

Above are three rules for us to avoid falling into the Middle-income Trap. Assuming that we are breaking systematic barriers to private enterprises’ participation in market economy, and boosting innovation and entrepreneurship of our society, then we are heading towards a promoting direction. We are marching in the path of light, regardless of the ups and downs of Sino-US relationship, the drop in GDP growth rate, or the monetary policy.

These principals also apply on knowing how better to run a business: don’t be hedged by rules and regulations at the beginning, pay more attention to your survival, and you’ll learn more when you start your second business.

For many years, Huawei has been the only Chinese company on the list of the Top 50 R&D Spenders. Regardless of the economy and its income, what Huawei has been doing is investing in its future, dedicated to R&D, continuously and resolutely. This provisional work underscores Huawei’s accomplishments, making Huawei anindustry leader.

So, there are standard answers on how to run a company,which could be summarized as concentration and professional dedication, continuous investment on innovation and trying harder in R&D. Entrepreneurship is also important, every single company needs entrepreneurs to push aside all obstacles and difficulties, to implement strategies and ideas. We, as investors, are destined to look for such outstanding entrepreneurs and their companies, invest in them and partner with them.

At this key point of history, a country, a company, or asingle individual, will all need to find the right path. Four decades after the Reform and Opening-up, it’s time to learn from our experience and stop “wadding across


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