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The differences in macroeconomic policy between America and China has been described as a difference between optimizing for GDP growth and optimizing for produc
by ipnon 1y ago
The differences in macroeconomic policy between America and China has been described as a difference between optimizing for GDP growth and optimizing for productivity growth: America will be satisfied with increasing GDP at the expense of productivity, and China will be satisfied with with increasing productivity at the expense of GDP. The Chinese state owned enterprises are able to burn through billions of dollars of investment with little or no returns so long as the end result increases total productivity in the economy at large, and not just profit at the level of the firms.
- bfg_9k 1y ago> China will be satisfied with with increasing productivity at the expense of GDP Yeah I don't think that's correct. They've got explicit GDP growth targets which implies they do care about GDP growth. https://www.forbes.com/sites/ywang/2025/03/04/china-sets-2025-gdp-growth-target-at-around-5-amid-major-challenges/ https://www.forbes.com/sites/ywang/2025/03/04/china-sets-202... Not only that, but they care about them so much that they feel the need to lie about GDP figures. https://en.wikipedia.org/wiki/Li_Keqiang_index https://en.wikipedia.org/wiki/Li_Keqiang_index Their own former VP had his own measurement he used as a proxy for GDP growth since he didn't believe the official figures.