China in the News

I'm going to start a new recurring feature, which will be a selected news article about China, with commentary from me. Click for the story: Shopping 101: China's Consumers catch on.

Summary:
Upon purchase, new apartments in China are an empty concrete shell. All amenities and improvements to that apartment are then up to the purchaser, and choosing what to buy for that apartment (and what to buy in any other situation) is extremely difficult for the Chinese, who have no previous experience with a consumer culture. That difficulty is multiplied with every single other purchasing decision they need to make, until they are overwhelmed.

Commentary:
Some weeks ago I began to notice that there are a lot of these vacant unimproved apartments here. Yet so many new buildings are under construction. Even an amateur economist can clearly see all of the classic signs of a dramatic oversupply. Within the strange brew of government planning and free-for-all capitalism, clearly the residential real estate market is not being subjected to conventional market forces. I don't know whether the costs of these projects is being carried by the government, the developers, or various investors. Actually, I don't have any idea how they finance major construction projects here at all. I do know, however, that the oversupply must be costing someone out there some big Yuan. It doesn't seem a very smart way to do business, but since the Wild West free market U.S. economy managed to dramatically overbuild its own housing supply, which is a of course one part of our current economic catastrophe, we clearly don't have any useful lessons to impart.

Two interesting anecdotes to accompany this train of thought. First, a young teacher we know was befriended by a local Chinese woman. The young woman invited the teacher to her apartment, where she lives with roommates in one of those unimproved concrete boxes, with not a fixture in the apartment other than a single toilet. Still, the Chinese woman said to her that it was "the best place I've ever lived". Things like that help foster the uncomfortable sense of "First World Guilt" that I think occasionally haunts all Westerners here (including me).

Second, a few weeks ago Lee and I noticed some activity in two of the vacant apartments, one above the other, across the way from us. It was after dark, and there were clusters of workmen in each of the two apartments, and all of the surrounding apartments were dark. The group above were inspecting the floor. The group below were inspecting the ceiling. Then both groups got out mops and buckets. It doesn't really qualify as a story, I guess, but it was a really funny visual image.

I'm rambling. Back to the article, and to my real point. I have expressed previously how annoying it is that the Chinese will pay so much attention to what we are buying in stores. They look, they snoop, they stare, they talk. And they buy... once in a housewares store, Lee approached a display of dishes. A woman was standing there trying to select some cups to buy. In her hands she had a couple possible selections. Lee approached the display, and confidently chose some porcelain mugs. As she left, she saw the woman replace the items she had in her hands, and select the exact same mugs that Lee had purchased. What really makes the anecdote revealing to us is that the woman had been holding items that were much more typically Chinese (they had cutesy cartoon characters on them, as do half the products in this country). Lee, on the other hand, chose the only mugs that were plain white porcelain in a simple design. Score one for the diffusion of American tastes in China. I'm remembering right now that a woman did the same thing to me when I bought some bread in a grocery store, literally watching me and then picking the exact same product. Score two. If I do that enough, maybe there will be more bread here that doesn't taste so sweet.

This article gave some interesting perspective on all of this. According to the author, shopping for consumer goods is overwhelming for the Chinese, who are only in the last few years really having a variety of products to choose from, and drowning in all of the advertising and marketing that go with them. They face hundreds of choices, and don't know where to turn to get real information. That, if you ponder it, is terrifying.

I used to do some activities related to this sort of thing back when I taught high school economics (which I will be doing again next year). Basically, I would get students to tell me what features they were looking for in the products they bought or wanted to buy; typically, I centered the activity on purchasing cars. Invariably, they cited appearance and quality as what they wanted in a car. Then, I would coax them into realizing that they really had no idea how to judge those things. They deferred to the mass opinion to judge the appearance of cars (just as well, since the entire purpose of having an attractive car was to impress others). Quality, on the other hand, they judged strictly by brand name, because in the end, few if any of them (or me) was in any position to accurately assess the quality of a car on our own. We all tell ourselves that we are making informed decisions, but most of the time what we are really doing is stirring together a mix of brand awareness, advertising, rumor, habit, and what some relative once told us, and calling it knowledge.

So now, try to imagine that you know absolutely nothing about cars, but you are about to spend several years worth of salary buying the very first car that you, or anyone in your family, has ever owned. All the while, salesmen, advertisers and marketers are descending on you from all sides, and they know full well that you don't have a clue. Now multiply that to everything else that you need to shop for. It is enough to give me nightmares, and thinking of it that way makes me a lot more sympathetic to the Chinese following us around in stores. Western consumer culture, and all of the variety, features, competition, marketing, advertising, pricing, ad infinitum, have come crashing down on a virgin population, and they are completely overwhelmed. The fact that they will look to random Westerners for shopping advice shows how desperate they are. The irony, of course, is that we are ourselves sometimes looking to them to figure out what we should buy (although I certainly hope we are more subtle about it).

Shop 'til you drop indeed.