Chinese Economics Thread

[Deleted member 23272]

Well, everything in China is cheap for a reason. But, actually China firms is still playing with catchup with other countries. They have to try as twice or thrice to eventually catchup. So cannot cut slack until China got truly dominant.

Except long working hours have never correlated with productivity.

Effects on birthrates since some people mention it though go beyond work, since even America with its more equal work life balance and Europe where laziness is almost promoted both have plunging birthrates. Granted the main culprit regardless of work culture is just how espensive housing is everywhere, but there's also the new reality where youth everywhere want to enjoy life rather than thinking they have to settle into a nuclear family and sacrifice their freedom.

 

[Quan8410]

Except long working hours have never correlated with productivity.

Effects on birthrates since some people mention it though go beyond work, since even America with its more equal work life balance and Europe where laziness is almost promoted both have plunging birthrates. Granted the main culprit regardless of work culture is just how espensive housing is everywhere, but there's also the new reality where youth everywhere want to enjoy life rather than thinking they have to settle into a nuclear family and sacrifice their freedom.

For a lot of small to medium business, the priority is just cutting as much cost as possible as they are mainly price competitive, especially in commodities where quality varies little.

 

[Blitzo]

Instead of fixing the issue itself? What other data should the government hide for the sake of denying its enemies "propaganda weapons," and if this is an issue of people's faith in the system, how is inceasing restrictions of data that would concern the average citizen for the sake of "national security" supposed to bolster the government's legitimacy exactly? Oh college graduates in China are left in the dark about their job and economic prospects, ordinary folks are robbed a key metric of the government and economy's performance, but the NYTimes has one less thing negative China story to write about, so checkmate Western world, flawless victory for the CPC?

Who says they are not fixing the issue itself?

If the issue requires multiple months or even years to be corrected, however information continues to be exploited for the sake of negative press coverage, then should they continue to provide the resources for that sort of coverage?

There are often cases of this where deprivation of information is a necessity or prudent. A few years ago there was a video documentary called under the dome about pollution in China which gained traction, and it was pulled online because it received too much coverage.
However that didn't mean China was not massively investing in the renewables industry in all domains, it just meant that people needed to let the government do its thing so as to not create unrealistic expectations that could compromise government policy.
And low and behold, we've seen notable improvements in air pollution, as part of a long journey to steering the nation to be more environmentally cohesive and friendly.

Plus if this is an issue of propaganda, I'm surprised people aren't saying that China should just throw in the towel right now, considering how low of an opinion even the most hardened Chinese nationalist has of China's information warfare capabilities.

Actually, what China needs to be able to compete in the information warfare/propaganda/PR domain is to achieve consistent, stable long duration material advantages, which can only be attained by consistent and stable political rule and to ensure that policies are not undermined by unrealistic public expectations and influence.


What is prudent may not be immediately satisfactory, and ultimately the most prudent decision is typically to "let them cook" -- in this case, being the CPC.
And if you disagree with that, then it's a question of who is wrong in their assessment of reality (in terms of capturing the full extent of information and making viable planning for the future), is it yourself, or the CPC/government?

 

[Michael90]

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Well, if the Chinese government thinks its best to stop publishing such data, then we can only trust their judgement that they know better than us.

 

[FriedRiceNSpice]

There is a time, the golden time of the middle class in US, when a man can work and provide for the whole family as a solo earner, hence the American dream. China, although progressed fast never attain that quality of life. Therefore, people is always seeking to earn more and money is the goal rather than the tool of life.

Well, once women begin working in some households, then women in other households will also need to start working in order to achieve a comparable amount of purchasing power, unless the man in the household is bringing in significantly higher income than others. Costs of living / prices / wages will adjust upwards to accommodate the new normal of two-income households, so it becomes no longer viable for most households to survive on a single income.

Hardly controversial, even the government at one point banned 996, although from the looks of things I'm surprised they've made little to no effort to enforce it and its still common practice for China's big firms to sometimes work employees until 1 in the morning.

Problem is enforcement is difficult. I heard that some firms complied by simply cutting base compensation across the board, and offered "overtime pay" to employees to work outside of "standard" hours. So the end result was that in order for an employee to earn enough "overtime" to bring in as much income as before, they would end up having to work 996 regardless. While in theory this at least allowed employees a choice, the end result was almost everybody elected to continue working 996. From employee's perspective, even if you did not care about the extra income, you would feel like by not working 996 while everybody else would negatively impact your future career prospects relative to your peers. If most of your colleagues are working 996, you would feel obliged to conform by also choosing to work the same hours. Care also needs to be taken when considering to impose more stringent regulations, less you fall into the situation of certain European nations where the competitiveness of your firms/businesses are negatively impacted by overregulated labor laws. Hopefully some kind of clever carefully-tailor policy can be formulated to reduce the incidence of the amount of people working excessively long hours.

Well, everything in China is cheap for a reason. But, actually China firms is still playing with catchup with other countries. They have to try as twice or thrice to eventually catchup. So cannot cut slack until China got truly dominant.

Chinese consumers can contribute to speeding up the process by choosing to support Chinese brands with their buying powers. People continuing to buy American/Japanese branded products for which there is a comparable domestic equivalent should feel at least a tiny bit like Hanjians.

Except long working hours have never correlated with productivity.

Effects on birthrates since some people mention it though go beyond work, since even America with its more equal work life balance and Europe where laziness is almost promoted both have plunging birthrates. Granted the main culprit regardless of work culture is just how espensive housing is everywhere, but there's also the new reality where youth everywhere want to enjoy life rather than thinking they have to settle into a nuclear family and sacrifice their freedom.

Yes, unfortunately sometimes counterproductive societal / cultural norms are hard to undo even in the face of data / science showing otherwise. In many US firms you see this with RTO mandates. Data has shown long hours do not correlate to increased productivity for years, yet this issue is still prevalent not just in China, but across East Asia and even in many American firms. I mean, in Japan workers are working 12 hour days while hardly spending 50% of that time actually working...

While long working hours may not be the only factor contributing to plunging birth rates, it is highly probable that it does have some degree of negative impact.

 

[sunnymaxi]

Ministry of finance announced -

Consumption came as one of the bright spots in

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. Services consumption logged a stellar 20.3% expansion in the January-July period, with robust summer vacation tourism. In July, the box office revenue surged 111% from the previous month & NEV sales jumped by over 30% YoY...

 

[sunnymaxi]

Tencent's second-quarter net profit climbed 33% from a year ago to CNY37.5 billion (USD5.14 billion), the Shenzhen-based tech giant said today. Revenue rose 11% to CNY149.2 billion (USD20.5 billion)...

JD. com second-quarter net profit jumped 50% from a year ago to CNY6.6 billion (USD904 million), the Beijing-based e-commerce giant said today. Revenue rose 7.6% to CNY287.9 billion (USD39.45 billion).

 

[Minm]

Instead of fixing the issue itself? What other data should the government hide for the sake of denying its enemies "propaganda weapons,"

Only western countries will refuse to solve a problem unless there's a lot of public attention on it. This is a weakness of holding public elections. Chinese politicians are perfectly capable of solving an issue even if they can't win votes. The Chinese system gives the government the freedom to work following its own priorities rather than following the media frenzy

 

[Stierlitz]

Aug 17 (Reuters) - Morgan Stanley is the latest among some of the major brokerages to cut China’s economic growth forecast for this year, following a spate of disappointing data from the country and worries over its embattled property sector.

The Wall Street bank now sees China’s gross domestic product (GDP) growing 4.7% this year, down from an earlier forecast of 5%, according to a note released on Wednesday. It has also lowered its 2024 GDP forecast to 4.2% from 4.5%.

Earlier this week, J.P.Morgan cut China’s 2023 GDP growth forecast to 4.8% from 5% earlier, while Barclays cut it to 4.5%.

Beijing had set a growth target of around 5% for this year.

Morgan Stanley lowered forecasts to “factor in a steeper capex (capital expenditure) slowdown amid deleveraging in the property sector and by Local government financing vehicles (LGFVs), with knock-on effects on consumption,” economists led by Robin Xing said in the note.

China’s property sector has been grappling with a liquidity crunch since late 2021, when China Evergrande Group collapsed and triggered a series of debt defaults.

Contagion fears following the country’s largest private developer Country Garden’s ability to make debt payments have risen, with asset manager Zhongzhi Enterprise Group on Wednesday flagging it was facing a liquidity crisis and would conduct a debt restructuring.

“Concerns about misallocation could make the initial policy response hesitant, exacerbating the debt/deflation loop,” Morgan Stanley said.

Data last week showed China’s consumer sector fell into deflation and factory-gate prices extended declines in July, mounting further pressure on Beijing to release more direct policy stimulus.

 

[ZeEa5KPul]

One of the greatest abilities the Chinese government has - and why I think it has a big advantage in the propaganda war with the West despite its clumsy messaging - is its capacity to forcibly remove ideas from circulation. If anything, I want the government to develop this capacity further and use it more frequently.

We rightly mock that EU clown whose name I can't recall for calling Europe a garden and everything outside it a jungle, but the mockery isn't about the idea itself. It's about it's application to Europe. If we consider the landscape of ideas, China is a garden and the West is a malarial swamp. A large part of the reason is the information management in China vs the "free market of ideas" in the West. Good ideas don't outcompete bad ones in the free market, bad ones persist and grow more malignant because people attach their identities to them. On deeper thought, that's the way it works in every market; people are attached to and loyal to their brands even if superior products are offered.

Youth unemployment is an idea that does China no good if it remains in circulation. The government is aware of it and is taking steps to address it, that's all anyone who isn't a government official working on this problem needs to know.

Incidentally, this information management is why the endless identity politics and "culture wars" in the West is absent from China. It's not because these people don't exist, they most certainly do and have tried to pull their stunts before. It's just that the house got dropped on them like the Wicked Witch of the East.