Are products in the United States becoming more expensive as China becomes a more wealthy nation?



  1. 0 Votes

    The basic answer is yes, but it’s mitigated by two major factors: 1) China heavily manipulates its markets, often with the intention of making life difficult for businesses outside the country, and 2) As time goes on, manufacturing any given item tends to become cheaper.

    China is very aware that the days of making money off people earning poor salaries are drawing to a close. Employees in big-name factories are demanding higher wages, and in important cases, such as the Apple factory, are demanding better working conditions, etc.

    It’s reasonable to think we’ll see something similar to what happened in Japan. During the 1980s, Japanese cameras were a steal. They used some of the best glass for lenses, and had some of the most advanced electronics. As Japan became increasingly prosperous, those cameras — particularly the top end ones that professionals use — became anything but a bargain.

    If China is following a similar road, in a similar timeframe (and that’s a big if!), then prices will be rising slowly and continuously for the next years, until about 20 years from now, products from China won’t be cheap at all.

    • 0 Votes

      I should have included in my assumptions that a higher priced product from China will tend to increase the price of a similar American product, and also that products in America that use parts made in China cannot avoid becoming more expensive, as the cost of those parts rises.

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