And the time to reach the customers. Most people,including business experts, often underestimate one monumental advantage China has that is almost impossible for any other country to nullify. The outreach to the customers. China is both manufacturing hub as well as the biggest market in terms of number of customers within same territory which reduces the cost for the manufacturing companies.
Chinese Economics Thread
- Thread starter Norfolk
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Worth noting that core inflation is still positive, but at a relatively low level - though stable. I still say that this isn't a time to worry yet, but if core inflation starts cratering into deflationary territory then it'd be a different story. We're not there yet.
In earnest, I think deflation is a worry only if China has an unemployment issue.
Despite the so-called high unemployment among the young, this is not yet the case.
Kids are being picky about jobs or simply not working until they feel like it. Chinese parents have more means than ever before to indulge them.
True, there is a mismatch in the type of college graduates. Too many general/liberal arts majors and not enough technicians. But sooner or later this will be resolved.
China already has the world’s largest vocational education system. More than 8,700 schools enrolled around 10 million students in 2022, according to the Ministry of Education (MOE).
But it still lacks skilled workers after spending the past few decades focusing on the expansion of access to – a system that now produces over 5.5 million graduates a year with academic degrees who struggle to find work during China’s slow economic recovery.
As a result, China is expected to face a shortage of 30 million skilled workers in the manufacturing sector by 2025, according to data from the Ministry of Human Resources and Social Security.
Further more, in any society -- especially a nominally communist/socialist country -- more goods leading to lower prices is a good thing.
What brings down countries historically has always been inflation. No government has ever fallen when goods are abundant and prices are cheap.
The China "deflation" angle is cope at best.
Despite the so-called high unemployment among the young, this is not yet the case.
Kids are being picky about jobs or simply not working until they feel like it. Chinese parents have more means than ever before to indulge them.
True, there is a mismatch in the type of college graduates. Too many general/liberal arts majors and not enough technicians. But sooner or later this will be resolved.
China already has the world’s largest vocational education system. More than 8,700 schools enrolled around 10 million students in 2022, according to the Ministry of Education (MOE).
But it still lacks skilled workers after spending the past few decades focusing on the expansion of access to – a system that now produces over 5.5 million graduates a year with academic degrees who struggle to find work during China’s slow economic recovery.
As a result, China is expected to face a shortage of 30 million skilled workers in the manufacturing sector by 2025, according to data from the Ministry of Human Resources and Social Security.
Further more, in any society -- especially a nominally communist/socialist country -- more goods leading to lower prices is a good thing.
What brings down countries historically has always been inflation. No government has ever fallen when goods are abundant and prices are cheap.
The China "deflation" angle is cope at best.
Could take a long time though, judging by other developed economies.
I personally just think the "one child generation" has serious attitude problems towards work & family formation, and their parents have the means to indulge them on it because of China's generous retirement benefits & housing boom. This combination of factors could lead to stagnation without decisive policy action, but China's historically been pretty decisive so we'll see.
China is not a developed economy yet and has a lot of natural growth left in many things including services and certain infrastructure so other developed economies are simply not good examples. China still has a lot of people who are used to working hard, no unemployment benefits and no immigration. Those 30M technical positions needed will eventually be filled by those youngsters at some point with the rise in wages. Though those college graduates want office jobs, most will have smarts and pragmatism to retrain for employment available.
And yes, China is decisive. Read the article, they are already tasking the local governments in pushing for more vocational training and more importantly in breaking down the stigma of factory work.
supercat
Major
I think China's "decentralization" described by Jin Keyu is relative to the conventional wisdom. I suspect China still has the most centrally planned economy in the world. As you mentioned, China has had centrally planned economy since ancient times, for example, detailed planning and efficient organization were required for large scale irrigation projects in the past. On the other hand, decentralization means more competition, which is absolutely needed for economic development.
China had a banner year of trade surplus in 2023, despite decreased exports.
I don't think Japan's auto export would be above 4.5 million in 2023.
It's true but all technical skill workers in manufacturing sector can be replaced by automation.
Still true that there's too much people graduate from liberal arts and economic business degrees.
liberal arts is fine IMO. Production of literature, art and other cultural products should be encouraged as long as they do not contradict social values.
however western economics doesn't even work in the west. if it did then how come their economies are in decline and income inequality is increasing? seems to me their economics models only work when energy is cheap and the rest of the world is enslaved under imperialism or recovering. worst of all Chinese universities hire these nobodies at high wages to indoctrinate students with useless bullshit.
Once again, deflation is simply misinformation. Pork prices continued collapsing but non-food prices increased by 0.5%. China needs to update the CPI basket so that a single highly volatile item like pork doesn't skew the numbers so much. It's basically the same story as with the very broad definition of youth unemployment that resulted in an overly scary number when compared with the more narrow definition in other countries.