China’s Economic Growth and Living Standards

Readers Question: Will China’s huge economic growth improve living standards for the people in China?

It is an interesting question.

Firstly, I will point to some resources on this question

Also, a general question on growth and living standards

How Growth can Help Improve Living Standards

  • Higher growth enables higher output and higher consumption
  • Higher growth should lead to higher tax revenue which means the government can (in theory) spend more on health care, education and reducing relative poverty

Why Growth May not increase Living Standards

  • Increased pollution from rapid growth
  • Damage to environment e.g. Three Gorges dam is controversial
  • Increased inequality. Benefits of growth are not reaching many in the north and on farms
  • Increased congestion from higher growth
  • Growth could be short term (boom and bust?)

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