8.1 The Stylized Relationship Between Asset Price Movements and Changes in the Wealth Inequality
8.2 How Changes in Income and Wealth Distribution Affect Asset Pricing
8.2.1 Impacts of Income Distribution on the Risk-Free Interest Rate and Risk Premium
8.2.1.1 Impacts of Income and Wealth Distribution on the Risk-Free Interest Rate
8.2.1.2 Impacts of Income and Wealth Distribution on the Risk Premium
8.2.2 Impacts of Income Distribution on Corporate Earnings and Return on Capital
8.2.2.1 Policy Matrix for Inclusive Growth
8.2.2.2 How Do Inclusive Growth Policies Affect Corporate Earnings?
8.2.3 Impacts of Income Distribution on Economic Growth
8.2.3.1 Theoretical Implications
8.2.3.2 Economic Growth Should Balance Efficiency and Equity
8.2.4 Impacts of Income Distribution on Industrial Structure
8.2.4.1 The Theory of Structural Change in the Economy with a Balanced Growth Path
8.2.4.2 Channels of Income Distribution Influencing the Change in China’s Industrial Structure
8.3 Empirical Analysis of the Income Distribution and Asset Price Performance
8.3.1 The US Experience: Low Interest-Rate Environment, Lower Volatility of Financial Asset Valuations, and Convergence of Valuations Between Industries
8.3.2 Japan’s Experience: Inclusive Growth Through Economic Transformation and Structural Upgrading Under Internal and External Challenges
8.4 Investment Trends Amid the Pursuit of Inclusive Growth
Sector | Potential benefits to certain sectors under the policy of common prosperity |
---|---|
Food and beverage | (1) Per capita milk consumption of low-income groups could increase, while consumption of high-end dairy products could lead to product upgrading |
(2) Income growth for low-income groups could lead to marginal increase in beverage consumption | |
(3) Branded snacks and snacks with higher unit prices may achieve wider distribution in rural markets with the increase in per capita consumption of snacks in rural markets; snack stores may successfully expand into lower-tier markets | |
Alcoholic beverages | Potential consumption upgrading in rural and county markets, which could lead to a rise in prices for mass-market, mid-range, and high-end products |
Edible oil | (1) Industry structure could be further upgraded, with products sold in small and medium-sized packaging replacing products sold in bulk |
(2) Edible oil to see potential consumption upgrading, which could lead to a rise in product quality and a greater emphasis on brands | |
Catering | Potential increase in imported food products, and a possible increase in market share for chain restaurants. Potential rise in frequency of consumption at branded catering businesses, and leading businesses may be able to successfully expand into lower-tier markets |
Textile | (1) Potential market-share gains for sports brands and sports equipment could become increasingly specialized |
(2) Possible consumption upgrading for menswear, womenswear and childrenswear, leading to improvement in product quality; brand channels may be able to expand their sales channels into lower-tier markets | |
Cosmetics | (1) Potential growth in functional skincare, professional makeup, and other categories, resulting from possible growth in consumption of specialized skincare and beauty products |
(2) Possible greater room for growth in consumption upgrading for cosmetics | |
(3) The expansion into lower-tier markets of new retail channels of cosmetics leads to brand expansion of lower-tier markets | |
Household appliances | (1) Under market competition, home appliance companies seek growth in emerging home appliance segments, leading the growth in the new markets. There is likely to be more products to target different price segments, product quality is likely to continue to improve, and the targeted customers may continue to expand |
(2) Channel cost is a key factor that affects promotional activities. We believe market competition in the home appliance industry should be protected, which would make full use of the industry's advantages. Efforts should be made to avoid large increases in channel costs resulting from the monopolization of channels by some platforms since it would lead to excessively high channel costs when promoting new home appliances, which would in turn slow down the adoption of new products | |
Home furnishing | (1) Market share of leading companies could continue to expand and brand channels could move down to lower-tier markets |
(2) There could be a gradual upgrading of household consumption as products in the industry are cost-effective | |
Automobile | (1) The number of passenger cars per 1000 people could increase, and the penetration rate of new-energy vehicles in low-tier cities could rise |
(2) More and more automobile manufacturing bases emerge, which could spur regional economic development |