To provide consumers with a better experience when shooting videos with drones, Frank Wang (left), founder and CEO of SZ DJI Technology, the world’s leading civilian drone manufacturer, together with his team, tests their drones at the Yarlung Zangbo Grand Canyon.

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The 2016 China Consumer Economics Society Annual Meeting was held in Shangdong University of Finance and Economics (SDUFE) in Jinan, northern China’s Shangdong Province from Nov. 18 to 20.

Themed “Supply-side Structural Reform and Consumption Transformation and Upgrading,” the meeting explored the focal issues of structural reform from the perspective of consumer economics.

Wang Shaojun, party secretary of SDUFE, said supply-side structural reform is an important strategy for China to address the economic “new normal,” and the transformation and upgrading of consumption reflects market changes on the demand side. Therefore, it is the inherent impetus for supply-side structural reform, he said.

Demand and supply, production and consumption are vital parts of the economy. In his A Contribution to the Critique of Political Economy, Karl Marx states that production is simultaneously consumption, and consumption is simultaneously also production.

Jia Kang, a research fellow from the Chinese Academy of Fiscal Sciences, said demand was the original impetus of economy. However, the manner in which the supply side responds to the demand side determines the characteristics of productivity and relations of production, laying the foundation for identifying the different developmental stages of economy. The reform at present aims to form a mechanism that satisfies consumption demand, he said.

In recent years, a series of new consumption activities, such as green consumption, information consumption and Internet consumption have emerged. Jia said consumption activities that provide people with upgraded consumption experiences require constant innovation on the supply side. The innovation of products will in return spur consumption, he said.

Qi Jingmei, a senior economist from the State Information Center of China, said supply-side structural reform aims to—by means of destocking and cutting excess production capacity—transfer high-quality resources to industries that have the potential to upgrade consumption. In this way, new and sustainable demand for high-quality products will be stimulated, she said.

In regard to the forecast of the domestic consumption environment and trends in 2017, Qi said that as reform makes progress, the scope of domestic consumption will constantly expand, and consumption will still be the strongest and fastest-growing contributing factor among the three drivers of economic growth: investment, export and consumption.

Zuo Feng, a professor of economics from Shangdong University, said an economy that is consumption-oriented should coordinate itself with the deepening of supply-side reform. Reform will elevate the balance between supply and demand from a relatively low level to a high level, he said, adding that the mechanism change should synergize with technological progress to usher in an economic development age that is dominated by consumption.

Lu Jiarui, a professor of economics from Beihang University, said that in the information age, supply and demand will be more transparent, and have more significant influence on national economy and social development. Meanwhile, the subject of supply and consumption, and the way people make transactions and interact are also likely to change profoundly, Lu said, adding all these consumption practices will be responded to in the supply-side reform.

 

 

 

ZHANG QINGLI is a reporter at the Chinese Social Sciences Today.