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An engineering marvel, but most likely an economic white elephant. The New York Times recently had a more critical report on China's bridges [0] China is addic
by MarkMc 9y ago
An engineering marvel, but most likely an economic white elephant. The New York Times recently had a more critical report on China's bridges [0]
China is addicted to infrastructure projects to boost its GDP. The problem is that these projects in aggregate produce a poor economic return, so China's debt as a percentage of GDP is growing unsustainably. At some point it will be forced to have a painful adjustment to lower growth, especially for investment spending.
Personally I find Larry Summers analysis pursuasive when he argues that China will most likely achieve 4% growth over next two decades [1]
[0] https://www.nytimes.com/2017/06/10/world/asia/china-bridges-infrastructure.html https://www.nytimes.com/2017/06/10/world/asia/china-bridges-...
[1] http://www.nber.org/digest/mar15/w20573.html http://www.nber.org/digest/mar15/w20573.html
- bane 9y agoIt is unsustainable long-term, but it's a reasonable model to follow. Build today while the cost is cheaper, create a larger general economy and then coast for a while. Japan also spent decades boosting GDP with huge infrastructure projects. They can't sustain them anymore and in some areas are starting to dismantle some of the excess but the Japan of today is much nicer place to have a flat economy than the Japan of the 40s or 50s.
- kqr2 9y agoDoes it take into account the benefits of developing large scale engineering and construction expertise? In many ways the United States Apollo program was also a white elephant as a space program of that scale was economically unsustainable, however, it had a huge impact on accelerating pace of technology development. http://www.computerworld.com/article/2525898/app-development/nasa-s-apollo-technology-has-changed-history.html http://www.computerworld.com/article/2525898/app-development...