Chinese Economics Thread

[horse]

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1. That was the whole idea of the "agglomeration economies," aka the urbanization. Bringing all the talent together into one place to make doing business easier. The urbanization is kind of big thing for the Chinese Communist Party, because it will tend to lead to there economies of scale, and development of the ecosystems for industry, factories, etc.


2. What were the factors of production? Labour and capital right? Go old school, and the factors of production was land, labour, capital. Today they added a couple more things, forget at the moment, drinking again. Land. Real estate. Look, if urbanization is a goal, you need land. Little wonder that Chinese real estate prices in the most important city clusters are through the roof. This is a byproduct of development, or precisely the direct result of the strategy of urbanization. They could not build enough housing fast enough. When it was built, the average Chinese had the means to buy, and buy, and buy more real estate, creating the entity that it is today.

That is why I do not believe this real estate issue is much of a problem. It is the tail of the dog. The tail does not wag the dog in China! It does elsewhere sometimes, but never in China.


3. Remember the trade war? Remember the Trump tariffs? Remember how the CCP devalued the Yuan just slightly? Remember that crackpot Navarro going ballistic because the Chinese did that? Haha!

The tariff, was going to make Chinese manufacturing more expensive, (see above article). But lowering the Yuan, makes Chinese manufacturing less expensive. That is what they did, they fought. If I keep my industries up and running, and keep growing, then I win. That is what those communist were thinking, because they were thinking the most hardline rightist ideology ever! How to damn make money and crush a fellow capitalist hopes like Trump!

The best capitalist in the world today probably are the communist Chinese. The future of capitalism! Haha!

 

[Deleted member 24525]

Not sure if serious. The USSR had amazing technology in those few areas their command-led apparatus invested autistic amounts into. In other areas, like commercial products, the USSR was backwards compared to the west because of a lack of private sector. At no point were USSR products competitive on the international market.

It's not true, the USSR was horrifically bad at diffusing technology. It repeatedly was the first to invent an industrial technology, or among the first to use it, and the last to roll it out in any meaningful scale. It only excelled in areas with little civilian application like rockets or marine nuclear technology, or in those where the civilian and military applications were very similar, like aerospace. In others it struggled because it just couldn't get the technology out to most factories. This was an issue with complicated political causes that were ultimately about the structure of the USSRs planning bureaucracy. I know of a paper with empirical data on Soviet technology diffusion and will post a link when I find it.

 

[HereToSeePics]

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The article is generally pretty accurate on the reasons it did mention(owning the supply chains and skilled workers) but didn't scratch the surface on the other major points such as infrastructure and domestic consumer market. China's manufactures are already supported by the massive base of Chinese consumers. Their supply chain won't be were they are without the infrastructure to transport raw and intermediate materials or to get workers to the factories reliably or have steady energy supplies, etc.

 

[FairAndUnbiased]

It's not true, the USSR was horrifically bad at diffusing technology. It repeatedly was the first to invent an industrial technology, or among the first to use it, and the last to roll it out in any meaningful scale. It only excelled in areas with little civilian application like rockets or marine nuclear technology, or in those where the civilian and military applications were very similar, like aerospace. In others it struggled because it just couldn't get the technology out to most factories. This was an issue with complicated political causes that were ultimately about the structure of the USSRs planning bureaucracy. I know of a paper with empirical data on Soviet technology diffusion and will post a link when I find it.

which is weird because they also invented mathematical economic optimization and ironically 100% believed in Ford style industrialism.

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V. I. Lenin, Leon Trotsky, and Joseph Stalin all opted for technological America. One of the momentous and almost forgotten chapters of modern history concerns the Bolsheviks’ fierce determination between the two world wars to adopt the industrial legacy of the United States: to re-create the steel mills of Gary, Indiana, behind the Urals; to duplicate Ford’s River Rouge plant in Nizhni Novgorod; to erect a copy of the great dam and generators of Muscle Shoals, Alabama, on the falls of the Dnieper River—all using American methods and American engineers, planners, and managers. Few Americans today can identify Frederick W. Taylor, the father of scientific management, but he and Henry Ford and other modern American industrialists and engineers influenced Soviet history deeply and permanently. For the Bolsheviks in the 1920s, Fordism plus Taylorism equaled Americanism. And Americanism, in that sense, was crucial to the success of the communist state.

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In Russia, too, more than Soviet and American automobiles were produced: people and ideas were created that crossed and blurred boundaries between "American" and "Soviet." There, "Fordizm" became a popular watchword among Soviet commentators and workers as a near-synonym for industrialization, mass production, and efficiency. Many saw it as a potentially valuable component of a new socialist world.

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He devised the mathematical technique now known as

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in 1939, some years before it was advanced by

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. He authored several books including The Mathematical Method of Production Planning and Organization (Russian original 1939), The Best Uses of Economic Resources (Russian original 1959), and, with Vladimir Ivanovich Krylov, Approximate methods of higher analysis (Russian original 1936).

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For his work, Kantorovich was awarded the

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in 1949.

 

[Deleted member 23272]

or, they just live off their parents and become influencers, streamers, pro gamers, etc.

Huh? So if 20% of China's jobless youths are unable to land any meaningful work they can just fall back on becoming a social media celeb? Its the first time I've ever heard something like this, afterall when people in America fall on hard times I never hear blithe advice about how they can just open a Youtube account or become Twitch streamer. That's because success in social media is one in a million and therefore by and large, why everyone who falls on hard times ends up as a gig worker. Including jobless Chinese who have no choice but to drive for either DiDi or MeiTuan.

All the other countries with 'high' youth unemployment like Sweden, France, Italy and Greece are famous for their low stress low pressure lifestyles that are the envy of the entire world. People would risk their lives and swim across oceans for even a 1% chance at their lifestyle.

Well, funny thing about that.

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And also the generous welfare systems is what draws migrants to Europe, not the "laid back" lifestyle but I digress.

But I'm becoming really confused here, is your argument seriously that youth unemployment is a sign of prosperity and that things are so good the youth can just live aimless lives on the beat, and is therefore much more preferrable to countries where youngsters have to get a job?

I don't think I have to explain why its never a good thing to have an aimless generation of youths unable to find meaningful work and clearly youths in that situation don't think so either unless their parents are millionaires. And if you care about China's future there's no point in sugarcoating the problem with fluff like how, "Oh Chinese youths don't have jobs? They can just paint, dance in the streets, and do graphic design while living off their parent's money." Even the government is having sleepless nights about how to stimulate the economy to get everyone a job, so let's just take break here from the cope and hope they get to work on solving the problem.

 

[horse]

The article is generally pretty accurate on the reasons it did mention(owning the supply chains and skilled workers) but didn't scratch the surface on the other major points such as infrastructure and domestic consumer market. China's manufactures are already supported by the massive base of Chinese consumers. Their supply chain won't be were they are without the infrastructure to transport raw and intermediate materials or to get workers to the factories reliably or have steady energy supplies, etc.

Actually, this post reminds me of something else.

A professor once told me about Chinese literature, and how non-Chinese who did not know anything about it, and if they were interested, then where to start, and it was kind of like overwhelming.

Of course what you write about is true, just that it is too much to put into one article, heh!

 

[FairAndUnbiased]

Huh? So if 20% of China's jobless youths are unable to land any meaningful work they can just fall back on becoming a social media celeb? Its the first time I've ever heard something like this, afterall when people in America fall on hard times I never hear blithe advice about how they can just open a Youtube account or become Twitch streamer. That's because success in social media is one in a million and therefore by and large, why everyone who falls on hard times ends up as a gig worker. Including jobless Chinese who have no choice but to drive for either DiDi or MeiTuan.


Well, funny thing about that.

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And also the generous welfare systems is what draws migrants to Europe, not the "laid back" lifestyle but I digress.

But I'm becoming really confused here, is your argument seriously that youth unemployment is a sign of prosperity and that things are so good the youth can just live aimless lives on the beat, and is therefore much more preferrable to countries where youngsters have to get a job?

I don't think I have to explain why its never a good thing to have an aimless generation of youths unable to find meaningful work and clearly youths in that situation don't think so either unless their parents are millionaires. And if you care about China's future there's no point in sugarcoating the problem with fluff like how, "Oh Chinese youths don't have jobs? They can just paint, dance in the streets, and do graphic design while living off their parent's money." Even the government is having sleepless nights about how to stimulate the economy to get everyone a job, so let's just take break here from the cope and hope they get to work on solving the problem.

there's also the skyrocketing enrollment in tertiary and post-tertiary education to train next generation of elite scientists and engineers.

 

[tankphobia]

Is it not actually a good thing for consumption that real estate collapse in value? People are only afraid to have kids, afraid to spend because they are spending a significant chunk of their lives saving for a house deposit, nobody would save money and be more willing to spend if housing wasn't so ridiculously expensive that it basically needs funding from 6 people (partners and their parents) for the average Joe to be achievable.

 

[FriedRiceNSpice]

They absolutely do. They literally live off of technology improvement, the Earth could not sustain as many people as it does without a long chain of technological improvement starting with chemical fertilizers. It doesn't get more stark than that.

This is the crux of our disagreement. You consider money to be the driving force of an economy while I consider it secondary. It's just a mechanism of distribution (a very unjust and inefficient one, but that's neither here nor there). What drives an economy is technology and the hands and minds that create it.

Yes, technology is great but its an end to a means, not an end all. Same applies to GDP growth. What matters is improving the quality of life and standard of living for the greatest number of Chinese possible. Not everyone can be a great scientist / engineer, but should still be able to enjoy a productive and prosperous life.

 

[FriedRiceNSpice]

Like, average people do not live off of technology improvement - they need compensation. STEM grads don't mean much unless they are paid appropriate wages to actually do STEM work.

STEM wages are dictated by market. If anything, access to higher quality engineers/scientists for much less cost is one of China's primary competitive advantages. The fact that wages are so highly inflated in certain STEM fields in the US indicate a shortfall of STEM talent.