To be clear, which of the newly-industrialized countries classically described as being in the middle income trap do you think that's not true of? Like is China going to be different from Mexico here because abuelas are demanding a high-standard of living?

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7 months ago | parent | next [-]

[deleted]

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fspeech 7 months ago | parent | prev [-]

The word "middle class trap" only makes sense for China based on FX rate. Rich Chinese will continue to diversify if not outright emigrate while the middle class is trapped by necessity. Meanwhile the savings/investment rate is so high that the Chinese middle class will enjoy things that middle classes in few other countries have, once normalized for population density. Right now they already lead in industrial robots per worker (behind only South Korea and Singapore). They will lead in service robots per capita one day as well.

	▲	fspeech 7 months ago \| parent [-]
		For example, Chinese coffee chains are beating Starbucks in China: "The pace of growth of domestic coffee chains has been impressive in the past year. Luckin’s performance has been especially strong. It has proved sceptics, who once saw its ultra-cheap coffee prices and high costs as a flawed business model, wrong this year. Luckin Coffee’s operating margin hit 15.3 per cent in the latest quarter as net revenues rose more than 40 per cent to $1.5bn, adding to annual sales that nearly doubled last year. It opened 1,400 new stores in the latest quarter, bringing its total to 21,300. Meanwhile, signs of the pressure are showing with same-store sales at Starbucks down 14 per cent in China last quarter." "Automation, a rapidly growing trend in the local coffee chain industry, is helping margins during a time when costs are rising, especially delivery, sales and marketing expenses. Cotti, which has grown rapidly since it was founded in 2022, is pushing out coffee-making robots. Luckin has fully automated pour-over coffee machines. Luckin’s coffee robots and unmanned coffee shops were key to maintaining growth during the pandemic." https://www.ft.com/content/5f070e18-3249-4bec-999b-56535cf25... And you would be hard pressed to find anyone middle aged or older that actually drinks any coffee.