Today, we are pleased to present a guest post written by Liang Bai (University of Edinburgh) and Sebastian Stumpner (Banque de France). The views presented represent those of the authors, and not necessarily those of the institutions the authors are affiliated with.
Over the last two decades, the share of US expenditure on imports from China has increased rapidly. Among others, this has contributed to a decline in US manufacturing employment (Autor et al. 2013). But how much did US consumers benefit from Chinese import penetration? Using detailed consumption data from US households for the period 2004-15, we estimate that prices of consumer tradable goods have grown by roughly 0.2 percentage points less per year, due to Chinese import penetration.
In recent years, there has been a shift of US expenditure towards imported goods. Figure 1 shows the decline in the domestic share of expenditure (DSE), that is, the share of US expenditure on goods produced in the US. The decline in the DSE is mirrored by an increase in the share of expenditure on goods imported from China, as China has overcome both Canada and Mexico to become the largest exporter of goods to the US.
Figure 1: The Rise of China in US expenditure. Note: Authors’ calculations based on data from CEPII and the Bureau of Economic Analysis (BEA). The figure shows the evolution of both the domestic and China shares of US expenditure on goods (left and right axis, respectively). The domestic share of expenditure is calculated as (expenditure-imports)/expenditure. Expenditure is computed as production + imports – exports.
In this paper, we focus on the years 2004-15 and estimate that Chinese import penetration led to a 0.2 percentage point lower annual inflation of consumer tradables. The reduction in inflation comes both from lower price growth of existing goods, and from higher entry and exit of products, and it is of similar size for different types of households by income or region.
Data and Inflation Measurement
We use highly detailed household consumption data from AC Nielsen for roughly 1.5 million barcoded products to measure price indices for 232 different categories of consumer goods (such as “chocolate”, “batteries” or “vacuum cleaners”). The data provide us with information on prices and quantities purchased, by individual item and household, for a sample of roughly 60,000 US households. They also include household demographic information. The data cover only expenditure on barcoded goods (excluding cars, for instance) and represent roughly half of consumer expenditure on tradable goods.
Using these data, we compute cost-of-living inflation for each of the 232 product categories and combine them with information on trade flows to estimate the effect of Chinese import penetration on cost-of-living inflation rates across product categories.
The price indices are based on a CES utility framework. An important feature of these price indices (and a departure from CPI) is that they account for the entry and exit of products (“variety gains”) using an expression developed by Feenstra (1994). Intuitively, consumers gain from product entry and exit when entering products are more competitive (in terms of quality-adjusted price) than exiting products. This is not necessarily related to the number of exiting and the number of entering products. In fact, variety gains can be positive (and contribute to lower inflation), even when there are more goods exiting than entering. What matters is how much consumers value these products, which is measured by their expenditure on entering vs exiting products.
Comparing inflation rates with high vs low Chinese import growth (using an instrumental variables strategy using Chinese supply shocks as IV), we find that Chinese import penetration significantly lowered cost of living for US consumers. A simple calculation suggests that on aggregate, cost-of-living inflation of tradable goods was roughly 0.2 ppts lower per year. With average household expenditure on tradable goods of roughly USD 10,000, our estimates imply that the cost of living per household was roughly USD 210 lower in 2015, due to Chinese import penetration in the period 2004-15.
The data show how the arrival of Chinese products disrupted the US product market. In the trade data we find that imports from China displaced both products made in the US and also products made in third countries. Product categories with higher Chinese import growth show higher entry and exit rates of products. These higher entry and exit roughly balance each other out, so that the total number of products in the market is unchanged. Despite no net change in the number of available products, consumers still benefit from variety gains, since entering products are more competitive than exiting ones. This is closely related to the measurement of variety gains in Broda and Weinstein (2006). Our results extend their work by showing that variety gains are still present even after accounting for the exit of previously consumed products.
The increased competitive pressure also reduced price growth of previously sold products. This is consistent with pre-existing producers reducing their markups but it is not conclusive evidence of such pro-competitive effects of trade. It may also reflect a reduction in production costs in import-competing industries, for instance through lower wages (as shown by Autor et al (2014) for instance).
The effect on prices of final goods may be even stronger if US companies sourced cheaper intermediate goods from China, and if these cost reductions were then passed on to consumers. We also test for this channel, but the estimates are very imprecise and therefore leave us unable to draw any conclusion about the role of intermediate goods.
Do some households gain more than others?
Finally, we test whether some households benefit more from Chinese import growth than others. To do so, we divide households into different groups by income and also by region of residence within the US, and re-compute inflation rates for each of these groups. However, we fail to find any evidence for substantially different effects across households. Inflation for consumer tradable goods fell by similar amounts for all groups. However, effects on overall inflation (across all consumed goods and services) likely differ across households, since low-income households typically have a higher expenditure share on tradable goods (see Fajgelbaum and Khandelwal (2016)).
This post written by Liang Bai and Sebastian Stumpner.
Estimating US Consumer Gains from Chinese Imports
By Liang Bai and Sebastian Stumpner
We estimate the size of US consumer gains from Chinese imports during 2004–2015. Using barcode-level price and expenditure data, we construct inflation rates under CES preferences, and use Chinese exports to Europe as an instrument. We find significant negative effects of Chinese imports on US prices. This effect is driven by both changes in the prices of existing goods and the entry of new goods, and it is similar across consumer groups by income or region. A simple benchmarking exercise suggests that Chinese imports led to a 0.19 percentage point annual reduction in the price index for consumer tradables.
[ Really nice. ]
The Production, Relocation, and Price Effects of US Trade Policy: The Case of Washing Machines
By Aaron Flaaen, Ali Hortaçsu and Felix Tintelnot
We estimate the price effect of US import restrictions on washers. The 2012 and 2016 antidumping duties against South Korea and China were accompanied by downward or minor price movements along with production relocation to other export platform countries. With the 2018 tariffs, on nearly all source countries, the price of washers increased nearly 12 percent. Interestingly, the price of dryers—not subject to tariffs—increased by an equivalent amount. Factoring in dryer prices and price increases by domestic brands, the 2018 tariffs on washers imply a tariff elasticity of consumer prices of above one.
April 21, 2019
Trump’s Washing Machine Tariffs Stung Consumers While Lifting Corporate Profits
By JIM TANKERSLEY
New research shows how a move meant to aid domestic manufacturers instead padded profits and raised prices on a wide variety of laundry items.
And JohnH told us that the incidence of these tariffs was borne by owners of corporate profits. Nope – another research paper that JohnH did not fully read before mouthing off!
Prices rose by 12% after tariffs of 40-50%. Exactly who absorbed the 28-38% that was not passed along to consumers?
First of all you grossly overstate the tariff rate, which applies at the wholesale price level not the retail price level. Of course someone as stupid as you would not get the difference between the two bases. Secondly, here is their AER publication so check it out:
BTW – where is your AER publication showing how Wal Mart is bearing those losses? Snicker!
Let’s walk through a simple numerical example that anyone who passed 1st grade arithmetic will get to see how stupid JohnH’s made up numbers and thesis really is. OK JohnH flunked preK arithmetic so I will go slowly.
In 2017 Wal Mart was charging you something made in China for $100 that it paid $80 for (no tariff). Its $20 in gross profits went to operating expenses (wages) of $15 and $5 in operating profits.
BAM! Trump hits them with a 25% tariff. 25% of $80 = $20 not the $50 that village idiot JohnH thinks. But come on – do you think Wal Mart absorbs this entirely by charging only $100? Of course not as that would mean either massive wage cuts or an enormous operating loss. BTW Wal Mart’s operating margin has gone up not down. Check its 10-K filing.
Oh wait – JohnH has no clue what a 10-K filing even is. But he is all happy to see pressure on those Wal Mart wages.
Yardda, , yadda, yadda….
Fact is, despite all the fearmongering about The devastating impact of Trump’s tariffs on consumers, it was basically a yawn. Economists really need to step in when the news media runs amok with its sensational, misleading reports. Fortunately, Consumer Reports did just this with its report, “ Why Consumers Shouldn’t Panic Over China Tariffs. The higher duties on Chinese imports may raise some prices, but there are ways to minimize the impact.” https://www.consumerreports.org/shopping/why-consumers-should-not-panic-over-china-tariffs/
Note the very measured tone: “higher duties MAY increase some prices.”
But pgl the Democratic partisan hack and the economics punditocracy insisted on bloviating about the dire consequences of something that turned out to be pretty much a nothing burger.
Thank goodness that at least CR tried to lend some perspective and honest insight.
JohnH: If you think 175K manufacturing jobs is a big yawn, ok. See https://econbrowser.com/archives/2020/09/guest-contribution-the-trade-war-has-cost-175000-manufacturing-jobs-and-counting
Personally, I don’t care for Trump’s trade policies. But what I do object to is the gross exaggerations made in the corporate media, often quoting prominent economists to bolster their highly misleading claims. Basically, the message was: “huge tariff increase; consumer prices to rise.” While both points were technically true; their studiously crafted juxtaposition suggested that the impact on consumer prices would be extremely big. This is probably what led Consumer Reports to advise people not to panic, the impact wouldn’t be nearly as bad as it was being painted in the corporate media. They were right.
Where were the prominent economists carrying a more realistic, moderate message to counter the tariff hysteria in the media?
Changing the subject to the issue of job losses, it is another unfortunate aspect of Trump’s tariffs. But why would economists suddenly care about that? Back when China PNTR was all the rage, I recall Josh Bivens as a lonely voice talking about the potential for enormous job losses. He was right. Losses eventually amounted to 3 million jobs plus.
At the time most prominent economists seemed to prefer sliding the issue of job losses under the rug. Krugman even went so far as to claim that China PNTR would be good for organized labor!!! And the issue of stagnant wages, attributable to some extent to China PNTR, is not discussed much in the corporate media or by economists in the punditocracy. But Trump certainly flogged the issue to his benefit…and Democrats reacted like a deer in the headlights.
As I said in an earlier post, much of America no longer trust experts. They have been burned too often by the exaggerated promise of policies like NAFTA and China PNTR.
If economists want to be trusted, they need to start pushing back against extravagant claims carried by politicians and by the mainstream media. The disadvantages of policies, like “free” trade, orchestrated by multinationals, largely for the benefit of multinationals, need to brought into public view and made part of the discussion. Government policies that boost corporate profits, wipe out millions of jobs, and exacerbate inequality, invite blow back.
Economists need to offer an alternative narrative, more impartial, more nuanced. Right now it appears that we have to rely on Consumer Reports and sites like EPI to do that.
JohnH: I am amused by the certitude you exhibit regarding net job loss due to China as opposed to productivity growth.
How desperate is JohnH to spin the premise that Trump’s tariffs on washing machines did not raise prices to consumers because retailers were kind enough to us that they absorb these tariffs in their profit margins. Never mind the fact that Wal Mart Best Buy etc saw larger profits margins. And ignore that paper published in the American Economic Review. What do they know?
Oh no he finds some fluff in Consumer Reports written by Penelope Wang. Nothing against Ms. Wang but she did not make any of JohnH’s stupid claims. Her piece advised consumers to shop wisely. Now she did write:
Until now, the tariff battle has mostly spared consumers. But on Sept. 1, Trump imposed a 15 percent tariff on a wide range of Chinese-made consumer products [PDF], including apparel, dairy products, toys, and microwave ovens. Another 15 percent tariff is scheduled to take effect Dec. 15 on more Chinese imports [PDF], especially consumer electronics such as cellphones, video game consoles, and tablets. Trump acknowledged that he delayed the tariff to limit the impact on the Christmas shopping season. Still, these hikes are likely to affect holiday shopping, perhaps limiting some discounts, which has raised concerns among retailers and economists. “For retailers, these tariffs take effect during peak shipping season, when they are bringing in products for the holidays,” says Jonathan Gold, vice president at the National Retail Federation, a trade group. “This is going to raise costs for families.”
Wait, wait – prices did not rise BEFORE the tariffs were imposed. But once they were imposed, her article notes economists were saying prices would rise. And the best of all – the date of this fluff piece was during the period before the tariffs were imposed on these goods.
Good grief – JohnH is even dumber than Bruce Hall. But of course pointing out what his own links saw and don’t saw makes me some sort of partisan hack? I told you guys this clown was a troll. And he is working really hard to prove me right.
EPI estimated 3.7 million jobs lost 2003-2008: https://files.epi.org/pdf/181374.pdf
A big part of the problem with job loss was that the losses were concentrated in the Rust Belt. Unlike Trump, who took care of an agriculture, industry hurt by tariffs, Bill Clinton couldn’t admit that large numbers would be hurt and never provided adequately for them. If free trade is truly a “win” for the economy as a whole, then there should have been plenty available to compensate those harmed, still leaving the beneficiaries well ahead.
While there may well have been productivity growth, wages stagnated. The fruits of productivity growth went largely to capital (the 1%.)
Could productivity growth offset those 175,000 jobs lost now?
It is true that its most fervent advocates exaggerated the gains to Americans that would occur due to NAFTA. But it is also false that NAFTA actually led to job or wage losses, something you have implied in several comments. It is true that the AFL-CIO has long officially taken this latter position, and it is believed by many midwest industrial workers to be true. But it is not the case. But then these workers sometimes cannot see things right smack in front of them, such as that higher steel tariffs by Trump led to job losses in the auto industry, such as when the GM Lordstown plant closed as a result of his steel tariffs in Ohio, but this year Trump still won the county that plant is in.
So the PIIE estimated as of Oct. 2016, that the average gain in jobs due to NAFTA was 200,000 per year while the average loss was 15,000 per year, with the wages for the new jobs on average 15-20 percent higher than the wages for those lost. There still could have been more done for those who did lose their jobs.
BLS reports that prices of laundry equipment have dropped 2.55% per year since 2018.
Oh, woe is be the poor consumer!!!
JohnH: That’s quality adjusted. Also you have to ask yourself what would’ve happened to the price in the absence of protection, given productivity growth in manufacturing.
Something tells me that JohnH did not understand what this meant:
“Between 1977 and 2020: Laundry equipment experienced an average inflation rate of 0.71% per year. In other words, laundry equipment costing $500 in the year 1977 would cost $678.01 in 2020 for an equivalent purchase. Compared to the overall inflation rate of 3.43% during this same period, inflation for laundry equipment was lower.”
The graph that followed showed year by year changes in the price of laundry equipment. There were some rather large declines BEFORE 2018. But in 2018 there was a rather large increase. Didn’t the Trump tariffs hit in 2018? Just saying that the information in JohnH’s is not exactly supportive of his defense of Trump’s tariffs.
I guess you did not notice the large increase in 2018. Or in 2020. Your little graph is not exactly supporting what you claim it is. Go figure!
Just for the record, a new account from April 2019:
‘A little more than a year after President Donald Trump slapped a 20 percent tariff on imported washing machines, new research finds that American shoppers have been the ones to pay the price. A study conducted by two researchers at the University of Chicago and a Federal Reserve Board Governor found that washers cost an average of 12 percent more after the imposition of the tariffs, or roughly $86 to $92 more per appliance. “It’s a good example of how the benefits of free trade are extremely diffuse but then the benefits of protectionism are concentrated,” said David Dollar, a senior fellow at the Brookings Institution.’
This study made in the AER. Note a couple of things here that run contrary to JohnH’s usual BS. The tariff rates (on the imported price not the retail) price are not nearly 50% as JohnH tried to peddle. And they raised prices in 2018 which JohnH’s link to laundry equipment showed. But of course JohnH peddles the small retreat in prices as if the tariff lowered the price of washers.
As usual, I am at a lost in terms of whether to call this troll a liar as he has shown himself time and time again too stupid to understand even basic data.
pgl would have you that Trump’s tariffs were all passed on to consumers (end users.)
“Trump’s China tariffs have not caused Americans to pay $1,000 more a year. Here’s why.”
“Numerous academic studies have concluded that U.S. businesses and consumers have paid nearly the full cost of Trump’s tariffs. These economists have mainly looked at customs levy data showing who is handing over the money at the U.S. border to bring in the goods. This kind of analysis does not offer clarity on how much of the burden falls on consumers vs. businesses that choose to absorb the cost.
But a recent study by economists at Harvard University, the University of Chicago and the Federal Reserve Bank of Boston went a step further, examining data from two large retailers on prices of similar goods, some of which face tariffs and some that do not. The economists found a “quite modest” price difference, suggesting that U.S. companies and retailers are eating a lot of the costs and making lower profits.”
There you have it. Instead of the panic and hysteria propagated by the corporate media and by partisan hacks like pgl, the price effects have been quite modest.
And guess what? pgl’s darling Democrats are showing few signs of wanting to reduce those tariffs anytime soon, something pgl won’t want to talk about…
Did you bother to read the opening?
“Gail Ross can tell you two things with certainty: Americans, not the Chinese, are paying for President Trump’s tariffs. And second, most of the costs were absorbed by U.S. companies, which is why consumers haven’t seen excessive sticker shock at stores. Ross is chief operating officer at Krimson Klover, a women’s clothing brand headquartered in Colorado.”
Of course retailers will whine that they are the one suffering. Like anyone (besides you) should fall for their spin. You finally found a single paper to supposedly support your spin. OK – time for me to read it as I know you have not.
Now I know you not read this paper – as this link in your story does not work:
And notice your Wash. Post fluff piece does not tell us the names of these supposed economists. JohnH is known to both stupid and a liar but this one takes the cake.
Now if you can find a reliable link to this supposed paper – please provide. But a little advice for Bruce Hall Jr. – read the research before you mouth off about it.
I think I found the paper that JohnH’s fluff piece could not provide a proper link. And this fluff piece did not accurately capture what the authors wrote:
Alberto Cavallo Harvard University Gita Gopinath Harvard University and IMF Brent Neiman University of Chicago Jenny Tang Federal Reserve Bank of Boston May 2019 Preliminary and Incomplete
‘Our work in this area remains in-progress, but we preliminarily find much less of a difference in price changes for affected and unaffected goods than what we found in the imports data. This is suggestive that, at least through April 2019, much of the price impact is absorbed by retailers who earn lower profit margins on those imports where they pay a tariff. Another possibility, following the logic and analysis in Flaaen, Horta¸csu, and Tintelnot (2019) and Amiti, Redding, and Weinstein (2019), is that in response to the tariffs, domestic producers raise their prices to retailers on goods that compete with the imports. Or alternatively, retailers may simply be increasing prices throughout sectors that are exposed to the import tariffs, earning higher margins on those goods not impacted by tariffs.’
The AER piece on washing machines already noted this paper. Of course a lazy lying idiot like JohnH could not be bothered to go find and read the original paper.
JohnH: Try to read the underlying economic research paper, rather than a journalist’s distillation, to figure out what the basic message is (and/or what shortcomings are associated with the methodology). US retailers are part of the “consumers” generically defined when talking about international trade.
Here is a post with links to the paper cited in your WaPo article.
China has been able to move up the value chain through massive IP theft, which shifts high paying jobs from the U.S. to China, along with reducing U.S. tax revenue. China is able to sell the high-end goods much more cheaply, because it didn’t pay for the big risks and hard work developing IP.
More undocumented BS from the peanut gallery. Let’s take the iPhone. China has not stole Apple’s IP as Foxconn is still nothing more than a contract manufacturer. But the phone is a collection of electronic parts sourced from firms in places like Japan and South Korea at least originally. But Chinese firms are moving up the value chain as it were by being able to make some of the components.
Now if you did real research (BTW – watching the Lou Dobbs show is not research) you would know that. But of course members of the peanut gallery like you spout the intellectual crap spewed every morning on Fox and Friends.
It’s well documented the harm China has done to foreign economies, particularly the U.S. economy, from IP theft, along with counterfeiting goods. You just haven’t researched it and remain as ignorant and foolish as before.
So well documented that Peak Idiot could not bother to provide us with a single analysis!
It happened mostly in the 80’s though. Since then, the US quit trying.
If so, they learned that strategy from us. We were infamous as stealers of IP during the first half of the 19th century.
Then we finally started developing our own technologies and became strong supporters of intellectual property rights, trademarks, copyrights, etc.
You do remember your American history classes?
Peaky is learning American history by listening to the Sean Hannity hour each night.
Every country has been engaged in IP theft, but never on the scale of China. The U.S. benefited from immigration, which was not IP theft. You must have learned history from a crackpot.
The scale of China? You do know their population is 4 times our population? Oh wow – more Chinese to frighten Peak Racist!
“The U.S. benefited from immigration, which was not IP theft.”
the us imported a tremendous amount of technology from europe through immigration. in those days, you had to import the brain. today you can transfer the knowledge on a jump drive. but it is still a transfer of IP from one nation to another. you are playing semantics to ignore the bigger picture, peak loser.
You need an unbiased and more complete view of history, rather than left leaning political views
A dog with a magnifying glass is your unbiased source. Excuse me while I fall on the floor laughing!
Interesting last line – “effects on overall inflation (across all consumed goods and services) likely differ across households, since low-income households typically have a higher expenditure share on tradable goods”.
Attention Wal-Mart shoppers “always low prices”. Yes a lot of goods on the shelves of Wal-Mart are imported from China.
Wal-Mart has another saying “always low wages”. The authors did cite Autor’s work on this issue.
But this is exactly want one would expect from trade liberalization. Consumers benefit but working in the import competing sectors suffer wage losses. Now if we had the government we had 60 years ago, maybe certain policies might be enacted so that the winners would assist the losers.
” winners would assist the losers.”
You mean like I was taught at the beginning of every Int’l Trade class I ever took, both undergrad and grad, immediately after the existence of gains from trade and Stolper-Samuelson? There may be a few economists who refused to learn this, but in my several decades of observation, it’s the politicians who are most obstinate, especially the Republicans. After all, while consumers gain from additional choice and lower prices, as this paper shows, gains from trade mostly accrue to the upper income strata. I know there are papers that show this but I’m 1) too tired 2) too time-constrained 3) too lazy to look them up.
The closest we’ve come to addressing this issue that I can recall was Trade Adjustment Assistance (during the Clinton Admin?). Based on what I saw with my students, it placed a heavy bureaucratic burden and a strict time limit on its recipients, especially relative to the level of aid it offered, thanks to compromises with GOP legislators necessary to get it passed.
Silly, idealistic me thought would be improved in the future but the GOP wants to help only those who don’t need it, and Obama had bigger fish to fry, namely the deepest, broadest downturn since WWII, and health insurance.
I hope this idea of winners compensating losers will again become part of the conversation. It’s certainly part of the theory.
The politics of trade adjustment in US are very different from what they are in smaller, much more open economies such as Sweden and Denmark, where exports are in the neighborhood of half the GDP. This means nobody on either the labor or management side wants to mess with them, which means they need to keep something close to free trade going. That means a lot of assistance to labor losing jobs due to trade, and in both nations on the order of 1-2% of GDP is spent on such assistance that takes various forms.
In the US, OTOH, with exports a much smaller percentage of GDP, neither party has been supportive of serious trade adjustment assistance, although Clinton did pass a minimal such version. Obviously on GOP side, they do not give a phoo about the workers at all, except rhetorically and do not want to spend any money on them. On the Dem side the AFL-CIO decided they would prefer to have protectionism instead, and so lacked enthusiasm for any trade assistance that might weaken the demand for that.
Trump has upset the apple cart by jumping in to raise tariffs, but with an outcome of net job loss for manufacturing jobs, even though it seems that a lot of midwest industrial workers somehow have not figured that out and still support him. He took the Ohio county in which the now closed GM :Lordstown plant is located, a plant that was severely negatively impacted by Trump’s steel tariffs. So it seems there are a lot of people who somehow cannot figure out which policies actually help them or hurt them and support somebody pushing policies that hurt them.
The Taiwan and Mainland Chinese entry in the tool market – wood working and metal working, made them affordable. The problem was knowing which were good and which were junk.
China has been able to move up the value chain through massive IP theft…
[ This is of course incorrect and racially offensive in the writing.
The Chinese were for instance shut off by Congress from working on “international” space station programs in 2011. Now the Chinese have constructed, launched. docked with and manned a prototype international space station and will begin to launch complete space station modules in the next few months. The Chinese have had a rover exploring the far side of the moon for 2 years now. The Chinese just launched a series of 4 craft that retrieved moon rocks and returned the rocks to China. The Chinese have completed an advanced global positing system. The Chinese have an explorer travelling to Mars. The Chinese have a thermonuclear reactor or “artificial sun.” The Chinese have completed an “800 kV flexible DC short-circuit test” for ultra-high voltage and long distance electricity transmission with an advanced converter. The Chinese now have a high-speed 350 km/h freight train, along with 35,000 km of high-speed track. The Chinese have already installed 700 thousand 5G base stations and shipped 144 million 5G phones this year….
Then there is the rice that grows in saline soil or sea-water rice…. ]
incorrect and racially offensive describes just about everything Peak Racist writes.
…global positioning system.
Massive stealing of IP gives China a huge advantage
Awww! CNBC finds a key CEOs who really hate competition. At least this source is not some dog with a magnifying glass!
A few points that I find are often missing from China-US trade stories:
* Among consumer goods manufacturers in China to a price/quality ratio that allows exporting, the vast majority are made by foreign-invested companies.
* That foreign investment relocated plants from Hong Kong, Taiwan, Korea, Japan, and a few other sources (largely inconsequential: remember, we talking about exported consumer goods) to China.
* Relocating a factory from one foreign location to another does nothing to American manufacturing employment.
* That relocation does, however, reduce the price of production (otherwise, why bother?) which allows — but does not necessarily deliver — a lower price for US imports
* Over the past four decades, the very large portion of consumer goods from China imported into the United States were middle- to low-end products.
* People who purchase middle- to low-end products don’t do so because they don’t like the selection at Saks Fifth Avenue. They do so because they have to.
To conclude, imports from China have done more to raise the standards of living of less well-off American consumers – and Chinese workers – than all the GOPer supply side economics ever conceived.
Spot on but can I expand on this:
“That foreign investment relocated plants from Hong Kong, Taiwan, Korea, Japan, and a few other sources (largely inconsequential: remember, we talking about exported consumer goods) to China.”
Hong Kong is a small densely populated area so manufacturing plants is not its thing. Now it can be the manufacturer of record as it hires a Chinese toll manufacturer to do the actual production.
But yea Foxconn originally sourced a lot of the iPhone components from Korea, Japan, and Korea but has relied a bit more from Chinese companies. Please inform Peak Stupidity as he clearly does not get this!
Having lived (and worked as a macro economist) in Hong Kong for over 30 years, I would remind you that manufacturing was indeed a very significant portion of the economy when China opened its doors. Manufacturing was over 24% of Hong Kong’s GDP in 1985, and more than a third of employment. By 2010, both were below 2%. Those plastics, garments, shoe, and toy factories didn’t just shut down.
In the first 20 years of China’s opening, Hong Kong-based companies poured half a trillion US dollars into the economy as long-term, direct foreign investment. During the next 20 years, they raised more than that amount on the Hong Kong stock market, thus being the true source of capital for China’s modernization.
Taiwan data is iffy, because prior to the late-1980s, it was considered treason to trade with or invest in China.
The production of goods did move to China but the flow of these goods somehow flows through Hong Kong affiliates of multinationals. Cheap Chinese labor but low Hong Kong taxes. A recipe for transfer pricing games which is why reported exports and imports for Hong Kong are over 100% of reported GDP. Which I guess is employment for tax attorney and accountants!
I had to go back and check with something I wrote 4 years ago, which reminded me that the ratio of exports/GDP for Hong Kong were near 200%. This updates their national income accounting through 2019:
The flow of goods through HK is larger than GDP because the port is highly efficient (globally, and in comparison to any other port nearby); the legal system is highly efficient (ditto); the financial system is highly efficient (ditto); the management services sector is highly efficient (ditto); and — most important of all — because HK entities OWN outright the majority of China’s exports. Hong Kong companies make the decisions.
One other minor point: the domestic economy is tiny, which makes trade look so large vis-a-vis GDP.
Tell me what global trade will do in the coming year, and I will tell you the change in Hong Kong’s GDP. It is, quite literally, all that matters. Domestic demand simply can’t compete.
World Trade vol. _ +5.7%
HK GDP _ _ _ _ _ _ +2.0%
Domestic _ _ _ _ _ -5.3%
2009 (North Atlantic Economic Crisis)
World Trade vol. _ -12.8%
HK GDP _ _ _ _ _ _ _ -2.5%
Domestic _ _ _ _ _ _+2.2%
Hong Kong cannot have a good year when world trade craters, nor have a bad one when it soars.
December 29, 2020 at 11:35 am
The flow of goods through HK is larger than GDP because the port is highly efficient (globally, and in comparison to any other port nearby); the legal system is highly efficient (ditto); the financial system is highly efficient (ditto); the management services sector is highly efficient (ditto); and — most important of all — because HK entities OWN outright the majority of China’s exports. Hong Kong companies make the decisions.”
I agree but permit me to add – there is a tax/transfer play here as Hong Kong profit tax rates are lower than China’s. Your next to last sentence sort of captures my transfer pricing paper. Hong Kong buys the intermediate goods and then outsources assembly to a Chinese toll manufacturing affiliate. The game is to have as little of the overall manufacturing profits sourced to the toll affiliate. But the Chinese income tax authorities are onto to this tax dodge.
Given the concept of comparative advantage, should anyone doubt that many in the US would benefit from the rise of China’s production?
The problem may be that certain workers have been disadvantaged. What do we do about the dislocated US worker? Also, how comfortable should we be if China produces a significant amount of medications and other essential products used in the US?
There’s also the issue of quality. Many of the 50 U.S. states, which were forced to purchase (due to bad MAGA policy) and procure PPE on their own, purchased defective equipment on their own, which they often payed for, before seeing, testing, or shipment of the equipment. How do you get your money back from Chinese suppliers/exporters who sold you bad PPE?? Good luck.
BOTH SARS and Covid-19 should have hit us with a sledgehammer over the head, that each individual state needs to have its own surgical mask and ventilator backlog of equipment (which would be a necessary unused “surplus” of PPE and ventilators in normal times) with rules on procurement, verification of quality (which can be better done locally), and rules on intermittent turnover/use (masks etc get dusty in warehouses) of said PPE equipment. It’s a very solid bet inside of the next 20 years we will have another Covid-19 or SARS-like event. Do we want a repeat of February—April 2020, calling up opaque/unknown foreign suppliers in a panicked frenzy?? The cost outweighs the 300,000+ death count and loss in economic output. A cost which by the way will not only be cheaper when demand for PPE is low, but will in fact pay for itself in increase economic output averaged out over time. And if the Federal government doesn’t want to do that, blue states’ governors can take the initiative on their own~~~with the proviso the equipment will only be used for their own residents.
PeakTrader: “China has been able to move up the value chain through massive IP theft, which shifts high paying jobs from the U.S. to China, along with reducing U.S. tax revenue.”
IP “theft”? Most Americans don’t own any IP. Why should they be concerned about “theft” from billionaires like Bezos and Gates who hide their profits from taxes. Those government enforced IP monopolies end up making Americans poorer through higher prices. Americans should be delighted to get cheap knockoffs of monopoly products from China.
It’s funny, when China was taking away U.S. blue collar jobs through cheap labor and currency manipulation, the globalists said that was just the market at work. Americans should be thankful for cheaper T-shirts and tube socks. But when China takes away billionaire incomes and white collar jobs by eliminating market distorting IP monopolies, the globalists scream bloody murder. Suddenly they say the market doesn’t seem to work anymore when Americans get cheaper Chinese phones and software.
IP law isn’t a free market. It is the exact opposite, a monopoly market. Those billionaires and rising income inequality isn’t a natural result of free markets. It a market deliberately fabricated to transfer income upwards.
There’s a big difference between offshoring old industries to China and China capturing market share in new industries through theft – obviously you see no difference and don’t understand the consequences.
Entering a new market is not threat. It is called free market capitalism and good old fashion competition. Something I guess you abhor.
Careful, the slip of your prejudice is showing.
“obviously you see no difference and don’t understand the consequences.”
Or, you completely missed the point. You should try reading it again objectively, without a bias toward power and money and without having already identified ‘good guys’ and ‘bad guys.’ Instead, think about the way an efficient, competitive, balanced economy is supposed to work, how a competitive market is supposed to lookand operate, specifically in regard to the US. Also note that I wrote “competitive” twice.
You have no idea of a competitive market. It doesn’t include an unlevel playing field, espionage and theft of private property, exploiting labor or the environment for a competitive advantage, etc.
“You have no idea of a competitive market.”
This from someone who supports monopoly power? I guess you never grasped why firms want patent protection in the 1st place.
No, you’re the one who has no idea what a competitive market is. Go back and read a good economics text. Start thinking in a more general equilibrium context instead of your partial equilibrium, an extremely narrowly defined PE at that. Think in terms of the US economy as a whole. Your vantage point is much too limited.
You completely ignore the production side of an economy and the many consequences of unfair advantages.
Even your consumption side statements are full of economic illiteracy and ignorance.
“You completely ignore the production side of an economy and the many consequences of unfair advantages. Even your consumption side statements are full of economic illiteracy and ignorance.”
This was said by PeakMoron – the king of economic illiteracy!
The only difference I see is whose ox is getting gored. The globablists are just fine with laws and economic policies designed to make blue collar workers poorer. The globablists don’t like it when they can’t rig the laws and economic policies to shift income upward to themselves.
It was the market at work. What else would you think in capitalism???? Consumers want lower prices.
PeakTrader: “China has been able to move up the value chain through massive IP theft, which shifts high paying jobs from the U.S. to China, along with reducing U.S. tax revenue.”
i really do not see any evidence that this is occurring, at least when talking about technology. high paying jobs are not leaving the us for china. low paying jobs maybe, but not high paying jobs.
Commenter JohnH and I have tried to make some points on this blog which have largely gone ignored, or worse condescendingly pooh-poohed. If Neera Tanden and Heather Boushey types set up camp and we all get months long lectures on race and gender, just prepare yourself right now for donald trump to wedge his foot right inside the door again circa 2023, in very short order.
Maybe hearing/reading it from a female, will make it more “palatable” for some of you folks, who could clearly not possibly care less about the American working man, but would rather admire yourself in the mirror for your self-assumed “SJW” “greatness”
Make what points? Your new BFF is insisting that the price of washing machines did not go up after the Trump tariffs. Oh no – Lowe’s is now making huge losses according to your BFF. Hey date our village idiot if you must!
This link is quite incoherent as well as nauseatingly pompous. It claims to support the working class in general, but I see not a single specific suggested policy this ranting about the Talmud provides, not one. Instead we get a lot of knocking of people who support reducing student loan burdens and criticize people who denounce as racist those who complained that “defund the police” was an unwise slogan to push.
This person does not even mention the minimum wage or protectionism, with the former the thing your pal, JohnH, has been hyperventilating about as the issue above all others, health, pandemic, whatever, that pushing hard would have made the working class turn out more for the Dems, with JohnH so upset about this lack of a super push on that issue that it is apparently the reason he supports a Third Party position, seeing no essential difference between Trump and Biden. at all. At least with you, Moses, you do recognize Biden to be better than Trump, even as you have regularly applied the forbidden “s word” to him and are down on a bunch of his appointees.
But, back again to this idiotic and pompous article. I would agree that talking about student loan debts does not particularly appeal to workers, but it does appeal to another segment of the Biden base that it was important to motivate to get out and vote, youth., and apparently they did come out and vote for him. So not obvious that this was something dumb for Biden to support. He did and does support higher min wage and also a more generous stimulus bill than came out of Congress, although those dumping on him seems to make no recognition of that.
As for the “defund the police” slogan, I agree this was unwise to push and regret that BLM activists in certain metro areas got so into using it, even though if one looks at it carefully there is a strong case for redirecting some funding for police to other uses. But as somebody noted, if you have to use 16 words to explain a three word slogan, that slogan is probably no good. And, of course, Biden himself repeatedly rejected the slogan, but somehow we have this creep going on and on about it.
Again, it remains unclear what this person thinks should have been stressed, especially keeping in mind that a lot of pro-worker things that JohnH mucks on about were and are supported by Biden and team. But of course the Trump gang did not talk about such things, instead making lots of noise especially about the “defund the police” slogan, which was dumb and damaging, even though totally rejected by Biden. So, Moses, this is really a stupid link, but then nobody here is surprised at all by you making stupid links.
@ Barkley Junior
Well, I know that people like you raised in white suburbs like to pretend how progressive you are, especially at times of convenience. While you make excuses for elitist, corrupt, and morally vacuous women who violently punch brown people (Neera Tanden) and blonde white women (Elizabeth Warren) with less than 3% Native American DNA claiming minority status while applying for university jobs. Affluent white suburbs like Leesburg, Va, inside of 2 hours from Harrisonburg, VA. are your kind of hangouts I am sure, and very fun to wave the naughty finger from I’m certain.
Those of us with actual brains know you don’t appoint people for jobs who “care about the little guy” ONLY as much as they can play it to get appointed for high status WH jobs that read well on their resume—read as Heather Boushey and Neera Tanden.
Look, Moses Senior, you have never provided a shred of you doing a single thing progressive other than shooting off your mouth stupidly here and linking to ghastly links like this piece of reactionary garbage you just did.
I got an FBI line starting in 1963 for my civil rights activities, the same year Bernie got arrested, I suspect before you were even born, old boy. I have also done other things mentioned here before that substantially changed policies and laws. But as doe you, go ahead, fake “Moses Herzog” tell us a single progressive thing you have ever done that amounted to anything, besides blathering inanely on the internet.
@ Barkley Junior
We all know the type of activities that really bother you Barkley Junior:
Although I’m sure Barkley, you’ve complained on this blog about Blacks, hispanics, and Native Americans being imprisoned over half their mortal lives for minor drug offenses, petty crime, or wives defending themselves against domestic abuse. Damned if I can find any of your comments on THAT though. Damned if I can find them.
I just hope, Barkley, you can defend all the blonde white women claiming to be Native American on university job applications from these “mean” and “cruel” internet trolls though. Keep fighting the good fight Barkley, keep fighting the good fight!!!!
Moses Herzog: What is this with the obsession with Warren’s claims? Anybody with a passing knowledge of race in America knows that there is a lot of misinformation imparted within families (actually, relying on family oral histories can also lead to grief). In any case: https://www.npr.org/2018/10/15/657468655/warren-releases-dna-results-challenges-trump-over-native-american-ancestry The question is whether these claims affected her policy stances.
Respectfully, I feel I have been relatively clear on this point. Whether my reason will hold sway as justifiable or a contention or assertion that can be “proven” I don’t know. I will restate in hope that at least my view of it will be more clear. If we had another hypothetical “Elizabeth Warren” and we can assume she looks the same, or we can imagine she looks totally different. We can even assume she was hypothetically a male. I have asked the “general reader” of this blog before, a question posed for argumentative purposes: “If we had the same circumstances and it was Mitch McConnell, how would we react if McConnell had <3% Native American blood and went around telling everyone he was Native American??". Do you find yourself coming to the same answer on "truthiness" as you do with Senator Warren??
If I felt that Senator Warren was sincere and genuine in stating she is "Native American" (how she views it in her own mind) I might still involuntarily chuckle while cupping my mouth with my hand, keep mostly quiet on the matter (believe it or not) and give her a "hall pass" on the topic. I just don't see it as a sincere contention on her part. i.e. I believe she consciously told a LIE. I don’t believe she ever viewed herself (her self-identity as she views it in her own mind) as “Native American”.
Now “you” (Menzie or others) can say “How can you play mindreader about other peoples’ statements regarding their family and self-identity??” . That’s a fair question and a fair argument. But I reserve the right to “call BS” as it relates to anyone (especially a politician running for U.S. President) on statements they give me where I straight out do not believe them.
I’m going to make a bad/poor analogy here, but one I think applies to a degree. Am I upset at the idea of giving Americans a $2,000 stimulus check in the mail?? NO. Am I angry at donald trump for saying he wants to give Americans a $2,000 check in the mail?? YES Now….. why would I say that?? Because I do not believe donald trump wants to give Americans a $2,000 check in the mail, I believe donald trump says he wants to give Americans $2,000 as a point of personal convenience—and that is why donald trump saying he wants to give Americans a $2,000 check in the mail makes me ANGRY and a point I might “OCD” style obsess over for weeks. It might be something I mention a year from now. Because I “know” it is a LIE, the same way I “know” Elizabeth Warren does not view herself in her own mind as Native American. I don’t buy that 3:00am UHF-TV infomercial for 1/10th of a second. It is using the abuse of a race, over decades (or more??) as a cynical tool for self-advancement.
Moses Herzog: You should watch at least once: https://www.pbs.org/weta/finding-your-roots/
Actually, Moses, none of this is the issue. You have claimed truly idiotically that I am like someone who lives in Leesburg, a place I have been in exactly once only briefly. You, however, speak for the worker. Well, I challenge you, you lying hypocrite: what have you ever done for workers? Have you ever worked in a factory? Have you ever belonged to a union or held a position in a union? Have you ever organized a union? Have you ever done any studies that helped workers (and I am not talking about blatherings on the internet)? How about other progressive activities? Have you in fact ever acted for or achieved any socially progressive or worthwhile goal of any sort?
About the only thing you have reported here on doing is having taught English in China for awhile. I think that is fine, but it is not something either progressive or impacting policy or laws or movements, much less American workers. You have done nothing along such lines, at least that you have bothered to tell us about.
I have not been in a union (unless one counts the AAUP), or specifically involved in the union movement, although I have lectured at EPI, which is supported by the AFL-CIO. I have also worked some minimum wage jobs that were pretty yucky and lowly, without going on about those too much. It is true, of course, that I have since become an academic economist, which is what I have mostly done professionally, but I also have actually been involved in a lot of progressive movements and activities, and have actually impacted some laws and policies substantially, some of which has been mentioned here, but a lot not.
Needless to say, your obsessive ranting about Warren and other women is sick and certainly not remotely progressive, although maybe you think that coming on like a macho sexist jerk gives you some kind of working class cred. Sorry, “Moses Herzog,” but no, it does not.
It should be obvious by now that Moses has a rather perverted view of women. It isn’t really about policies. He either talks about women’s appearances or how attracted he is to them or else they fall into the category that he despises. There is a cruder way of putting this, but I will refrain. It’s a pattern he has repeated again and again.
Moses Senior has not even acknowledged that latest JohnH nonsense. You see no household is paying more for washing machines after the Trump tariff as tariffs somehow magically wipes out the profits of Lowes. Of course no research supports this BS even if the lobbyists for the retailers complain they are the losers from tariffs. Everyone knows the lobbyists are lying but the great ‘progressive’ JohnH is echoing their BS. Go figure.
The followup to the decapitation of the statue of Hans Christian Heg in Madison is that nobody took credit it for it, it becoming clear those who did had no idea who he was and were just on a general destructive rampage. So it never became much of a right wing meme, although Trump and some others did mention it a few times. it would be the “defund the police” line that would play much more into the hands of the Trumpists, with Heg just too obscure. Of course you posted from this woman who was complaining about all the activists pushing the “defund the police” line, but suddenly here you have switched again, trying to play “activist,” although it is clear you have never done a useful or serious progressive thing in your life, unless you want to count your incoherent rantings here.
I have watched the show “Finding Your Roots” intermittently from time to time, and although not a fan of the host, I do think the show is often entertaining and very educational. You can imagine my eyes were glued to the screen when they had Bernie Sanders on, Larry David on, and Sarah Silverman on. I think the show is contributive, productive to the dialogue on race, and that any time people are more open to discussing race “between races” it’s helpful. I learned a lot about race while attending a largely Black grade school when I lived in Lawton Oklahoma, which had a high percentage of Black students there because of its proximity to Fort Sill. That’s not implying I’m an expert on race, just saying it helped in my own personal growth on racial issues, to be surrounded and interact with Black students (who were kind to me on a personal level, even though they had every reason in the book not to be kind to me as a scrawny white kid. This was back in the 1980s.)
I’ll tell you this much, the day Elizabeth Warren appears on “Finding Your Roots” to answer questions candidly about how much she has participated in Native American culture and Cherokee culture in her life, along with pictures and documents showing her enthusiastic embrace of this anytime before she received her Bachelor’s (she claims to have embraced this self identity in her childhood from her parents), you can bet I’ll have the date marked, circled, and highlighted in neon green on my calendar. Because I very much enjoy watching tap dances. I think if Senator Warren had made even half an effort to interact with Native American tribes when she was growing up in Oklahoma, or any time after, instead of regarding it as garnishment to a resume or red, white, and blue bunting for a political campaign.
I had something come up here, and then hit “post comment” before finishing my last thought in the last sentence—the entire last sentence in my above comment should have read—- I think if Senator Warren had made even half an effort to interact with Native American tribes when she was growing up in Oklahoma, or any time after, instead of regarding it as garnishment to a resume or red, white, and blue bunting for a political campaign~~~the acceptance, reception, and “digestion” of her claimed Native American self-identity from the general public would have been much more pleasant for Senator Warren.
It wasn’t BLM activists that spread it, but “activists” unrelated to BLM that joined run of the mill BLM protests, who were likely anti-Trump groups put together by in the 2016 election’s wake. They made a massive error in judgement. Now BLM is irrelevant again as they stopped marching with them.
December 26, 2020
Cases ( 19,433,847)
Deaths ( 339,921)
Cases ( 10,188,392)
Deaths ( 147,659)
Cases ( 2,550,864)
Deaths ( 62,573)
Cases ( 2,256,005)
Deaths ( 70,405)
Cases ( 1,643,169)
Deaths ( 30,157)
Cases ( 1,372,243)
Deaths ( 121,837)
Cases ( 541,616)
Deaths ( 14,800)
Cases ( 86,933)
Deaths ( 4,634)
December 26, 2020
Coronavirus (Deaths per million)
UK ( 1,034)
US ( 1,024)
France ( 958)
Mexico ( 940)
Canada ( 390)
Germany ( 359)
India ( 106)
China ( 3)
Notice the ratios of deaths to coronavirus cases are 8.9%, 3.1% and 2.5% for Mexico, the United Kingdom and France respectively.
December 27, 2020
Chinese mainland reports 22 new COVID-19 cases
The Chinese mainland on Saturday recorded 22 new COVID-19 cases, including 10 from overseas and 12 locally transmitted, the National Health Commission announced on Sunday.
The 12 locally transmitted cases include 7 in northeast China’s Liaoning Province and five in Beijing.
Fifteen new asymptomatic COVID-19 cases were also recorded, while 251 asymptomatic patients remain under medical observation.
No COVID-19 deaths were registered on Saturday. Meanwhile, 16 patients were discharged from hospital. The total number of confirmed COVID-19 cases in China has reached 86,955 and the death toll stood at 4,634.
Chinese mainland new imported cases
Chinese mainland new asymptomatic cases
[ There has been no coronavirus death on the Chinese mainland since the beginning of May. Since the beginning of June there have been 7 limited community clusters of infections, each of which was an immediate focus of mass testing, contact tracing and quarantine, with each outbreak having been contained. Symptomatic and asymptomatic cases are all contact traced and quarantined.
Imported coronavirus cases are caught at entry points with required testing and immediate quarantine. Cold-chain imported food products are all checked and tracked through distribution. The flow of imported cases to China is low, but has been persistent.
There are now 334 active coronavirus cases in all on the Chinese mainland, 4 of which cases are classed as serious or critical. ]
there is now a major outbreak in dalian. the city has been shut down.
December 26, 2020
The New York Times Hasn’t Heard About China’s Vaccines
By Dean Baker
That is the implication of a major piece * on how the coronavirus vaccines are leading to greater worldwide inequality, since the rich countries have reserved the vast majority of the 2021 supplies of vaccines of the leading U.S.-European vaccines. While this is in fact a serious problem, as my co-authors and I have noted, ** China also has produced several effective vaccines and is distributing them to developing countries.
China has already made commitments to supply hundreds of millions of doses to Brazil, Morocco, Indonesia and other developing countries. While it would be best if every country with manufacturing capacity could produce any vaccine, without regard to intellectual property rules, it is bizarre that a piece on access to vaccines in the developing world would fail to mention the vaccines developed by China.
Not impressed. All its done is create a massive debt bubble that was already a little frothy in 1980 and turn it into a monster by 2020. Secondly, China’s story ended in 2010. Now they are exporting production similarly.
US consumers have lost love of country and instead replaced it with crude individual self gratification. If allowed to its own devices, capitalism would already be dead.
If I had a dollar for every time someone said about China “it can’t last,” I’d have a large pile of dollars. No longer impressed (if I ever was) with that lazy thinking.
(Oh, and the economy doubled, in real terms, in the past decade.)
Where racists see black and brown people, RWNJs see “liberals”, and the Rose Twitter crowd see “Democrats”, The Rage sees debt bubbles at the root of everything they identify as a problem. Since their comments are usually very short and barely literate, the overall effect is that they’re just as ignorant but less pompous and arrogant, and therefore irritating, than the likes of Peak Trader (and the other Usual Suspects) and JohnH.
“RWNJs”? This is too esoterically cool for me. Maybe “Right Wing New Jerseyans”?
For that matter I have no effing idea who the “Rose twitter crowd” is either. But then I am not on Twitter and just totally uncool, so please forgive me.
What is, is. Debt created capitalism. Without multipliers, capitalism is dead in the short run as debt is needed to be so high, to keep living standards artificially high.
PeakTrader was the original member of the Usual Suspects. JohnH is just their latest recruit.
China’s story ended in 2010….
August 4, 2014
Real per capita Gross Domestic Product for China, United States, India, Japan and Germany, 2007-2019
August 4, 2014
Real per capita Gross Domestic Product for China, United States, India, Japan and Germany, 2007-2019
(Indexed to 2007)
Nice FRED graph.
Did you mean to compare China to the US, Japan, and Germany, as if those economies were somehow similar to China? If so, total ignorance. If not, figure out how to make a meaningful graph.
Did you mean to show that only once in the graph span India – a country with at least some passing similarities to China – grew faster than China? Makes my point.
Average real GDP Percent Change, 2010-19
China _ _ _ _ _ +7.7% p.a.
India _ _ _ _ _ +6.7
Mexico _ _ _ _ +2.7
Brazil _ _ _ _ _+1.4
Russia _ _ _ _ _+1.9
Argentina _ _ _ _+1.4
So Africa _ _ _ _ +2.4
China’s story ended in 2010….
August 4, 2014
Real per capita Gross Domestic Product for China, United States, India, Japan and Germany, 1977-2019
August 4, 2014
Real per capita Gross Domestic Product for China, United States, India, Japan and Germany, 1977-2019
(Indexed to 1977)
The ending of severe poverty in China in 2020 is a marvelous achievement and promises more as the planning going on for 2021-2025 has been making clear.