The Channel City Club and Committee on Foreign Relations welcomed well-known economist Sung Won Sohn, Ph.D., to a luncheon held Monday at Fess Parker's DoubleTree Resort in Santa Barbara.
Before introducing Dr. Sohn, Channel City Club member Brian Robertson awarded Betty Rosness a certificate from the Santa Barbara Maritime Museum in honor of her dedication to local nonprofit organizations.
Dr. Sohn graduated from both the University of Pennsylvania and Harvard Business School. He has experience serving on a number of corporate boards, including Forever 21 and Claremont Graduate University, and is the Smith Professor of Economics and director of the Institute for Global Economics Research at the California State University-Channel Islands.
The topic of his lecture on Monday was "What Is Right with the American Economy?" which included his insights on economic growth, productivity and the United States’ economic advantages.
In his talk, Dr. Sohn explained his views on creating growth in the U.S. economy. The key to improving the economy, he said, is limiting government regulations. However, he reminded the audience that economic progress and technological advancements do not always equate to a more satisfied consumer base and society.
He suggested that development methods such co-creation and crowd-sourcing, two theories taught at Harvard Business School that encourage the involvement of consumers in the creation of products, can help raise levels of consumer satisfaction by allowing for broader input in product research and development. Brands such as GoPro, Lego and Levi are presently employing co-creation and crowd-sourcing methods.
In his lecture, Dr. Sohn focused primarily on the global economy, rather than the local economy.
“Economics should be a useful science,” Dr. Sohn said during his presentation.
He explained to his audience the importance of economic productivity. He defined productivity as the standard of living that has progressed throughout U.S. history from the installation of railroads to the Internet. Dr. Sohn emphasized that productivity gains have been slowing down recently and as a result, economic growth is slowing down as well.
Although contrary to popular belief, Dr. Sohn predicts that China will not continue to grow as rapidly as it has in the past. China’s decreased productivity rate will have a large impact on the economy as a whole.
Dr. Sohn admits that the United States is the best investment for the stock market because of several advantages. The first is economic size.
“Size matters,” he says, and with United States’ natural resources in hand, it can produce enough oil for imports to go down and production to increase.
Institutional advantages including the huge number of excellent U.S. colleges, universities and research facilities serve as the backbone of stability and certainty of the U.S. economy. The United States’ geographic location in a region with few nearby enemies further strengthens its stable economic position.
Dr. Sohn’s prediction of the future of the U.S. economy is promising. He trusts that there will continue to be economic growth, but it will not be as exciting as it has been in the past decade.
— Shayna Smith is a senior at Anacapa School.