2/7
Li Keqiang told the meeting: βWe must take comprehensive measures to expand effective demandβ.
I think they may be confusing "expanding demand" with "expanding specific components of demand".
Li Keqiang told the meeting: βWe must take comprehensive measures to expand effective demandβ.
I think they may be confusing "expanding demand" with "expanding specific components of demand".
3/7
The amount Chinese households consume, like everyone else, mostly depends on their consumption budget, which is equal to their income less their desired savings. If they spend more on one set of products because of tax breaks, they will spend less on others.
The amount Chinese households consume, like everyone else, mostly depends on their consumption budget, which is equal to their income less their desired savings. If they spend more on one set of products because of tax breaks, they will spend less on others.
4/7
In that case effective demand only increases by the amount of the tax break, which is small. More generally, without an increase in direct or indirect income, there can be no sustainable increase in consumption.
In that case effective demand only increases by the amount of the tax break, which is small. More generally, without an increase in direct or indirect income, there can be no sustainable increase in consumption.
5/7
The article notes: "Consumption, which was barely mentioned in Thursdayβs Politburo statement, was positioned as a major economic growth driver."
The article notes: "Consumption, which was barely mentioned in Thursdayβs Politburo statement, was positioned as a major economic growth driver."
6/7
There seems to be a real conflict within policymaking circles whether or not to focus on consumption as the driver of growth or simply to return to the old days of expanding investment and subsidizing manufacturing.
There seems to be a real conflict within policymaking circles whether or not to focus on consumption as the driver of growth or simply to return to the old days of expanding investment and subsidizing manufacturing.
7/7
For examples of the latter views, check out these two speeches translated for us by @ZichenWanghere at Pekingnology:
pekingnology.com
For examples of the latter views, check out these two speeches translated for us by @ZichenWanghere at Pekingnology:
pekingnology.com
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