China’s Low Consumption Problem and Subsequent Economic Slowdown: Understanding the Investment-led Model of Growth
Keywords:
Chinese Economy, Economic Growth, Chinese Economic Model, Housing Crisis, Consumption Slump.Abstract
The Chinese economy has encountered an economic slump since the first quarter of the year 2023. Numerous assessments and theories became commonplace prompting the study of the causes and implications of this evolving crisis. Amidst investigations, an investment-oriented model of growth appears to be a commonplace for analysts. Their propositions often promote and imply that the causes of the slowdown in consumption are an outcome of this model. Drawing on a descriptive methodology, this research aims to detail and critically study the contrasting viewpoints of investment model of economic growth by Chinese and Western theorists. It seeks to elucidate the underlying factors that have contributed to the economic consumption slump in China. Discerning whether the Chinese or Western perspective answers the fundamental inquiry of how a rapidly growing economy encountered such a radical slowdown, it explores the intricacies of the Chinese economy and drivers of the current downturn in consumption.
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