Chinese Economics Thread

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taxiya

Brigadier
Registered Member
Blackstone said:
Not an apple to apple comparison, because US and EU are advanced economies, while China is still a developing economy. One expects higher Chinese productivity gains relative to US and EU.
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I have expected you to say the opposite.
Isn't productivity the result of Produced divided by Cost (man-hour)? It is another way of saying efficiency. A developed economy should have a higher productivity than a developing one, not the other way around. A lower and declining productivity indicates the decline of the economy system.
 
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taxiya

Brigadier
Registered Member
Orthan said:
Bloomberg article about china´s productvity.

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China has a serious problem with produtivity. In 2015, the total factor produtivity of china even declined while india´s grew. China needs to adopt free market reforms. Its state capitalism economy wont work indefinetly
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Yeah, this kind of "smart" authors have been saying this all their lives. Decades ago when China's SOE were not working well, they say "see, SOE is not working". Now they accept that SOE actually work pretty well, but change their tone to "Yes it works now, BUT not indefinitely".

By the same kind of "logic", would they have said "private free capitalist has a lower/lowering productivity today, therefor it must be nationalized"? "it worked well before, but not now". I have never heard of them saying that. That is mind-twisting.

This kind of mental gymnastic performance clearly show that they are not professionals but pure propagandists with a preset conclusion regardless of input to their articles.
 
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Blackstone

Blackstone

Brigadier
taxiya said:
I have expected you to say the opposite.
Isn't productivity the result of Produced divided by Cost (man-hour)? It is another way of saying efficiency. A developed economy should have a higher productivity than a developing one, not the other way around. A lower and declining productivity indicates the decline of the economy system.
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The key phrase is productivity gains, and not simply productivity. If a country's productivity is among the highest in the world, then its gain would be proportionally smaller than a less developed country's productivity gains.
 
Y

Yvrch

Junior Member
Registered Member
Probably the word you are looking for is growth rate, not gains.
OP said it was TFP, not non-farm business labor productivity. One cause of US and EU 28 low labor productivity growth is demographic structure. Wages/salaries grow as you age along, reaching your highest earning power around 40-50 cohort and more or less stay steady from there onward. Since baby boomers are still right around the retirement age but not quite there yet, their earnings outstrip 20-40 year old cohort, lop siding the labor cost to a higher level. Wealth inequality is also one offshoot of baby boomers as they tend to have more assets, aka, wealth, versus younger cohorts.
Wages in China are rising, so it tends to slow down the productivity growth rate, cetaris paribus.
 
Jura The idiot

Jura The idiot

General
I noticed as News Of The Hour at gazeta.ru now
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quoting May 12, 2017 12:37 a.m. ET Trump Administration Announces Deal With China to Boost Exports
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which is behind paywall so I used google, found:
White House announces trade deal with China to boost U.S. exports
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After months of bashing China for its trade practices, the Trump administration said it had agreed with Beijing on a broad range of measures aimed at improving the access of American beef producers, electronic-payments providers and natural-gas exporters, among others, to the world's second-largest economy.

Some items on a 10-point plan the White House released Thursday address longstanding irritants between the two countries, as both governments strive to show warming ties while seeking cooperation on a range of economic and diplomatic issues like North Korea's nuclear program. Others are general principles and may not ensure concrete policy changes beyond promises to try to expand commerce in certain sectors.

"U.S.-China relationships are now hitting a new high especially in trade," Commerce Secretary Wilbur Ross said in unveiling the package at the White House.

The plan was reached as part of a new economic dialogue launched when Chinese President Xi Jinping visited President Donald Trump at his Mar-a-Lago Florida resort home in early April and was unveiled shortly before a high-profile global economic summit Xi is hosting Sunday in Beijing. Chinese officials have been eager for the U.S. to signal support for that meeting.

An expanded version of this report appears on WSJ.com (
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).
 
F

Franklin

Captain
Orthan said:
Bloomberg article about china´s productvity.

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China has a serious problem with produtivity. In 2015, the total factor produtivity of china even declined while india´s grew. China needs to adopt free market reforms. Its state capitalism economy wont work indefinetly
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I think we need to take The Conference Board numbers on China that the article quotes with a pinch of salt. Its a US based NGO. Its not an official source and one of its former members was Harry Wu a known opponent of China.
 
Hendrik_2000

Hendrik_2000

Lieutenant General
This article below should refute the BS about Chinese productivity

A Robot Revolution, This Time in China
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Here is the video
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By
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MAY 12, 2017
  • HANGZHOU, China — Even a decade ago, car manufacturing in China was still a fairly low-tech, labor-intensive endeavor. Thousands of workers in a factory, earning little more than $1 an hour, performed highly repetitive tasks, while just a handful of industrial robots dotted factory floors.

    No longer.

    At Ford’s newest car assembly plant in Hangzhou in east-central China, at least 650 robots, resembling huge, white-necked vultures, bob and weave to assemble the steel structures of utility vehicles and midsize sedans. Workers in blue uniforms and helmets
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    of the welding, but much of the process has been automated.

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    Photo
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    The Ford plant in Hangzhou. CreditGiulia Marchi for The New York Times
    The state-of-the-art factory exemplifies the vast transformation that has taken place across manufacturing in China. General Motors opened a similarly ultra-modern Cadillac factory in the eastern suburbs of Shanghai, as well as one in Wuhan. Other automakers are also pouring billions of dollars into China, now the world’s largest auto market.

    Robots are critical to China’s economic ambitions, as Chinese companies look to move up the manufacturing chain. The Ford assembly plant is across the street from a robot-producing factory owned by Kuka, the big German manufacturer of industrial robots that
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    .

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    Automated machinery at the Ford plant. CreditGiulia Marchi for The New York Times
    For carmakers, the reliance on robots is driven partly by cost. Blue-collar wages have soared because multinational companies have moved much of their production to China even as its labor force is rapidly changing. The combination of the one-child policy, which cut the birth rate through the 1980s and ’90s, and an eightfold increase in college enrollments has cut by more than half the number of people entering the work force each year who have less than a high school degree and
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    .

    Blue-collar wages are now $4 to $6 an hour in large, prosperous cities, though still far lower than in the United States.

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    Automation is also a competitive necessity. As carmakers jockey for customers’ attention, they have no choice but to deploy the latest technologies, even in research and development. The challenge is how to keep a competitive edge, while trying
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    from being copied quickly by Chinese rivals.

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    Automakers see their reliance on robots as being driven by cost and competitive demands.CreditGiulia Marchi for The New York Times
    “We’re basically building an R&D center here in China, and test track, that is on par with other parts of Ford,” in North America, Europe and Australia, said Mark Fields, the chief executive of Ford Motor. At the same time, he said, the company would protect its intellectual property.

    Robots perform tasks like welding in exactly the same way every time, improving quality control. But they require a lot of fine-tuning along the way.

    The painting process is also mostly automated. Elaborate spraying robots, their joints covered in many layers of plastic so that they do not become clogged with paint mist, snake back and forth across each car body. Workers still apply protective sealant to the vehicles’ interiors and underbodies, as Ford has been leery of depending entirely on robots for this step until it is sure they work well. More robots are scheduled to be installed in August, replacing manual labor for the protective sealant step as well.

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    Robots covered in multiple layers of plastic apply primer to vehicle frames at Ford’s Hangzhou plant.CreditSarah Li for The New York Times
    Automation doesn’t elicit the
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    in China as in the United States. With car demand in China growing quickly, ever more factories and workers are needed to produce more cars. The Ford factory here in Hangzhou may have 650 robots, but it also has 2,800 workers. Other automakers continue to hunt for skilled workers to fill vacancies in their factories.

    “Robots aren’t the threat,” said Paul Buetow, the director of China manufacturing at General Motors. “The threat is not being able to run your business with products that people want to buy.”
 
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Blackstone

Blackstone

Brigadier
CCP has its job cut out to create the necessary environment to foster service industry growth so it could absorb workers laid off from manufacturing and related industries. Also need to succeed in supply side reforms and transfer wealth from the state sector to consumers. Extremely hard work ahead for government and corporation leaders.
 
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