The Chinese have coined the term involution for “[the] arms races between students or workers, for whom extra effort brings no extra reward, because it obliges everyone else to try harder, too.” Essentially, ultra-competitive industries begin to cannibalize their own profits to get ahead.
For example, some car manufacturers send their own (brand new) cars to used car dealerships to “split their market, offering pre-owned but undriven vehicles to price-sensitive customers.” Naturally, this leads to high losses.
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I must admit, I am confused how an economy can sustain such behaviour. Is this due to overly-generous industrial policy? Are Chinese lenders unusually generous towards this kind of behaviour?
G3_aesthetics_rule on
>As well as rebuking carmakers for giving customers too good a deal, it has told the solar-panel industry to exercise “self-discipline”. At the end of last year, 33 panelmakers duly pledged to set a ceiling on production and a floor under prices.
Lmao, price controls but in the other direction. The Peronist mind would explode.
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“We’re all trying to find the guy that did this”
The Chinese have coined the term involution for “[the] arms races between students or workers, for whom extra effort brings no extra reward, because it obliges everyone else to try harder, too.” Essentially, ultra-competitive industries begin to cannibalize their own profits to get ahead.
For example, some car manufacturers send their own (brand new) cars to used car dealerships to “split their market, offering pre-owned but undriven vehicles to price-sensitive customers.” Naturally, this leads to high losses.
______
I must admit, I am confused how an economy can sustain such behaviour. Is this due to overly-generous industrial policy? Are Chinese lenders unusually generous towards this kind of behaviour?
>As well as rebuking carmakers for giving customers too good a deal, it has told the solar-panel industry to exercise “self-discipline”. At the end of last year, 33 panelmakers duly pledged to set a ceiling on production and a floor under prices.
Lmao, price controls but in the other direction. The Peronist mind would explode.