cross-posted from: https://hexbear.net/post/6725431
C-suite executives across Chinese industry anticipate falling input prices as lower costs for raw materials and logistics drive efficiencies.
The Cheung Kong School of Business publishes proprietary surveys of hundreds of top business managers across China, and companies report chronic falls in prices for raw and intermediate goods.
But they also report difficulty in passing through these savings to bottom-line profits; consumer prices are also falling, relentlessly, economy wide.
In Western economies, deflation is a signal of collapsing economic activity, and even depressions.
But Chinese deflation is a result of powerful supply-side forces that have the opposite effect: China’s economy continues to grow at solid rates, while rent-seeking profits are extinguished at the company level by high competition.
The funny thing is, “perfect competition” in neoclassical economics is considered to be the most efficient system, as it theoretically allocates resources most efficiently (if you ignore externalities), and provides the lowest price for consumers. The end result is also that companies produce zero net profit. So any western economist should look at this and approve, right?
Yes it has long seemed that the post Deng era is “use capitalist economic fundamentals against the capitalists,” which has been working better than any other nation in providing an increasingly better quality of life for their citizens while preparing the ground for the downfall of the imperial core.
I found a YouTube link in your post. Here are links to the same video on alternative frontends that protect your privacy:
