The Future of Chinese Growth

27 Pages Posted: 7 Jul 2010 Last revised: 28 Jun 2011

See all articles by David Beim

David Beim

Columbia University - Columbia Business School, Finance

Date Written: January 24, 2011


China’s real GDP has grown at an average annual rate of 10% for the last 30 years. A period of such super-growth is historically most unusual and now is likely nearing an end. The devices that have stimulated growth in the past – heavy capital investment and a massive focus on exports – face constraints: capital investment faces diminishing returns, and exports are undermined by wage inflation. Both constraints are visible in China today. China needs to stimulate domestic consumption of its prodigious output, but this is easier said than done. A push to do so will damage the export model well before it succeeds in building a replacement.

Keywords: China, growth, exports, value destruction, crisis, NPL

JEL Classification: E21, E22, F14, F43, G21

Suggested Citation

Beim, David O., The Future of Chinese Growth (January 24, 2011). Available at SSRN: or

David O. Beim (Contact Author)

Columbia University - Columbia Business School, Finance ( email )

3022 Broadway
New York, NY 10027
United States

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