China Economist Zhang Bin Urges Stronger Counter-Cyclical Policy to Break Weak-Demand Loop

TREE NEWS update: Zhang Bin, a researcher and deputy director at the Chinese Academy of Social Sciences’ Institute of World Economics and Politics, said on September 19 at the Tsinghua PBCSF Chief Economists Forum that China’s main economic imbalance is strong supply against weak demand, a total imbalance driven by weak business and household expectations. He said individual rational behavior compounds into a negative self-reinforcing loop, which is a market failure requiring strong external force to break, with stronger counter-cyclical adjustment the most effective tool.