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China Center Insight Compilation: Dimensioning Chinese Consumption Dynamics
  • Authors:

    Siqi Zhou

  • Publication Date:
    July 2018

Dimensioning Chinese consumption dynamics is a key focus area for The China Center. This collation of recent China Center reports illuminates different aspects of the unfolding consumption story in China and outlines the implications for MNCs operating in China. Analyses illuminate and expand on insights such as:

  • Based on international precedent, Chinese consumption may be at an important upward turning point, but from a comparatively low base. 
  • Changes in discretionary spending patterns indicate emergent consumerism in China, especially in rural areas. 
  • Urban households are saving a greater share of their growing income even while spending more. By contrast, rural households are spending an increasing share of their income and saving less. 
  • Income inequality is a major cause of low consumption levels in China. 
  • Consumer market opportunities are significantly skewed toward China’s most advanced cities.
  • In the short term, household consumption growth in China should uptick somewhat in 2018, in delayed response to growth in disposable income that occurred in 2017. 
  • Longer term, an increasing labor compensation share in GDPcaused by a shrinking labor force and rising wagesshould serve to bolster China’s consumption.

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