We are all consumers in USA and in China

As any society becomes more affluent, it is difficult to keep the consumer behaving in a price competitive manner. Now that Chinese consumers are richer, they do not appear to take as much time to stretch their money further. They are not price conscious. However,the American consumers try to change the lifestyles as reported in the media nowadays due to higher costs of fuel and food. The rich folks in China would lead to impulse buying, which presumably means that retailers can sell commodities at higher prices than they would otherwise. Such spending would affect the level of aggregate demand in the consumption sector of GDP. When the rate of growth is not reduced,inflation icreases. If supply and demand increase at the same time and at the same rate, inflation would be curbed in the long run. Such is a dream in the thought of academic community. It would be probable or improbable - i.e. getting consumers to shop more judiciously would lead to a reduction in prices.(sic)
If responses are to be elicited from thoughtful readers of this blog,varied scenarios may be scintillating. I rest my blog here.

Francis Shieh a.k.a. Xie Shihao,a lifelong learner of behavioral economics. June 27, 2008