Xiaokai Yang (born as Yang Xiguang; Simplified Chinese: 杨小凯; 6 October 1948 to 7 July 2004) was a Chinese-Australian economist. He was one of the world's preeminent theorists in economic analysis, and an influential campaigner for democracy in China.
Yang was born in China, the son of Chinese Communist Party officials. His parents' status meant that he initially had a privileged life, receiving an excellent education by Chinese standards at the time.
However, his life changed dramatically in the early days of the Cultural Revolution. Yang was a Red Guard in Hunan who was part of the Rebel faction Shengwulian. On behalf of the group, Yang wrote probably the most influential article of the Cultural Revolution. He published a political treatise entitled "Whither China?", which was highly critical of Mao Zedong's communist regime. Xiaokai contended that the essential conflict in China was between the new "red capitalist class", consisting of CCP cadres and their families, and the masses of the Chinese people. This was a shocking and daring deviation from the traditional Maoist view that conflict in China was essentially between Mao and his enemies. Xiaokai's essay was read by hundreds of thousands of Chinese during the Cultural Revolution. It could not be read openly, and was passed secretly between trusted friends, provoking lively debate across China. So great was his influence that members of the 1980s Democracy Movement in China labelled Xiaokai "the forerunner of the Thinking Generation". Mao personally denounced Xiaokai as a counter-revolutionary in 1969. Xiaokai was arrested and sent to prison for 10 years. At one point, Xiaokai learned that he was scheduled to be executed, though this never eventuated. Distraught by her son's treatment, Xiaokai's mother, Chen Su, committed suicide.
While in prison, Xiaokai managed to learn English and calculus. He learnt from and deeply admired a fellow prisoner who happened to be a mathematics professor and a devout Christian. In 2002, Xiaokai himself converted to the Anglican Church.
When he was released, Xiguang Yang (his original name from birth) changed his name to Xiaokai Yang (his childhood nickname), so that he could find a job. He gained admission to Hunan University and published two highly influential books on economics. He then studied at Princeton University, where he obtained a PhD in economics.
Following his study at Princeton, Xiaokai accepted a postdoctoral fellowship at Yale University. In 1988, he moved to Australia and took up a position as lecturer at Monash University. He quickly gained widespread international attention, publishing numerous English-language articles and books. He was made senior lecturer in 1989, reader in 1993, and was awarded a personal Chair in Economics in 2000. In 1993, he was elected to the Australian Academy of Social Sciences. He was twice nominated for the Nobel Prize in Economics (2002 and 2003).
He collaborated with some of the world's leading economists, including Yew-Kwang Ng and Jeffrey Sachs, the latter of whom stated that "Yang is one of the world’s most penetrating and exacting economic theorists, and one of the most creative minds in the economics profession". In 2002, Nobel Prize Winner Professor James M. Buchanan said that: "In my view, the most important and exciting research in economics in the world is done at Monash, and it is done by Xiaokai Yang."
Xiaokai was a neoclassical economist. He is praised by his colleagues for having cleared up many unhelpful digressions in economic writing, and returning the discipline to the fundamental insights of Adam Smith. His work is founded on the assumption that all persons (potential traders) are equal in all relevant respects. He moved from this to develop an extensive explanatory apparatus. His work encompasses equilibria that involve more behavioral adjustments than those defined in orthodox neoclassical models of general equilibrium. According to Buchanan, this approach has major implications for a wide range of issues in economics, such as globalisation, outsourcing, as well as interoccupational and locational mobility.
Although he was a prolific author in economics, Xiaokai simultaneously wrote a large body of influential political essays in Chinese, including a best-selling book. He championed democracy, decentralisation of Chinese political power, and privatisation of the Chinese economy. When he died, Nanfang Zhoumo (Southern Weekend), the most influential reformist magazine in China, published a long obituary, praising Xiaokai, and discussing the pervasive impact of his writings.
Professor Xiaokai Yang was diagnosed with lung cancer in September, 2001 and died on July 7, 2004 after a long battle with it, which doctors had predicted would kill him many years before he eventually died. He is survived by his wife and three children. His eventful life is described in his memoir, Captive Spirits: Prisoners of the Cultural Revolution.
- Klaus Mehnert, 1969 Peking and the New Left at Home and Abroad, Berkeley: Center for Chinese Studies. (This book focuses almost entirely on Xiaokai's writings of the Cultural Revolution.)
- Xiaokai Yang and Susan McFadden, 1997. Captive Spirits: Prisoners of the Cultural Revolution, Oxford University Press. (Xiaokai Yang's memoirs) Review fragment.
- Xiaokai Yang and Jeff Borland, 1991. "A Microeconomic Mechanism for Economic Growth," Journal of Political Economy, 99(3), pp. 460-482.
- Xiaokai Yang and Yew-Kwang Ng, 1993. Specialization and Economic Organization: A New Classical Microeconomic Framework, North Holland.
- Xiaokai Yang, 1994. "Endogenous vs. Exogenous Comparative Advantage and Economies of Specialization vs. Economies of Scale," Journal of Economics, 60(1), pp. 29-54.
- Xiaokai Yang, 2001. Economics: New Classical versus Neoclassical Frameworks, New York: Blackwell, Description and chapter -preview links. (A comprehensive treatise of Xiaokai Yang's economic thought.)
- Xiaokai Yang et al., ed., 2005, An Inframarginal Approach to Trade Theory, v. 1, World Scientific. Description and scrollable contents link. Papers include 14 (co-)authored by Yang.