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The good news is PRC, like western capitalist pigs are willing to sell the rope that hangs them. It's never been more affordable and accessible to build up nasc
by maxglute 9mo ago
The good news is PRC, like western capitalist pigs are willing to sell the rope that hangs them. It's never been more affordable and accessible to build up nascent manufacturing. PRC now one stop shop for bootstrapping development from cheap energy to infra to capital goods at involution prices vs PRC developed by paying premium on western capita goods. PRC, also like western capitalist pigs assume their dominance is so entrenched that others are unlikely to catchup, at least not in relevant time frame.
The bad news is unlike western capitalist pigs that drank own koolaid, PRC might be right. Ultimately PRC manufacturing has to also be calibrated to price in bottom 40% of domestic pop whom are relegated to low income, ~2000 USD per year, i.e. they will structurally hold on to low/medium end manufacturing competitiveness even as they move up the value chain. Realistically PRC won't be vacating those low end until 2050s when that cohort starts dying. Or potentially never with automation.
In the meantime, as long as global south slowly trend towards low-middle income, i.e. ~5000 usd customers, that's still growing 3billion+ people into market / S-curve territory for consumer goods from phones to air conditioners to low end nevs. TLDR PRC is giving all the tools for poor countries to catchup, betting they won't. Maybe that's hubris, but there's a reason PRC isn't actually trying to export it's political/development model, because bluntly they don't think others can replicate it, least of all due to PRC agglomeration scale alone. Maybe India.
- orwin 9mo agoPRC economic boom followed a massive investment in infrastructure and government-led development plan, taking Stalin's 5-year plans as an example, and Keynes demand-side economics as a functional economic theory (unlike the USSR who chose to ignore non-marxist economists basically). It is replicable on a smaller scale, but you need huge initial investment (or slave labour).
- maxglute 9mo ago> smaller scale Quantity has a quality of it's own. The sheer quantity of massive country agglomeration effects is what makes PRC system not replicable, i.e. you need country with 800 million people to sustain 500m "modern" workforce that can optimize for every industrial cluster that becomes mutually reinforcing. This not something smaller countries (i.e not PRC or India) can invest of enslave their way into. Current PRC is a model predicated off cultivating and integrating 800 million people into an all domain supercluster, that population scale is an initial investment gate.