Premiums and discounts in Shanghai

I'm not really sure how applicable this is to all emerging markets, but there is definitely a distinctive character to consumerism in Shanghai which could very well be similar in other rapidly growing economies. Prices are easy to take notice of in Shanghai, every day you will notice how strange things are compared to the western world. Take today for example...

I went to a bar called Big Bamboo to watch Arsenal destroy Blackburn (6-2, oh yeah!). It's aimed at westerners so it is not the greatest example, but there's way more impact using a current affair! Anyway, the cheapest pint of beer costs 40RMB (£3.70 or so). This isn't cheap. The place is not swanky at all, it's not like drinking at a fine restaurant! The expat audience makes sense, but still... £3.70 for a pint of beer is not cheap by any means. As I walk home, I walk past a ton of different shops. Clothes shops are criminally expensive here. It's probably the expat label they've stuck on every item in the mall... but expats aren't stupid. It's more expensive to buy decent clothes in Shanghai than it is in London.

It is highly annoying, because the choice is so good here. There are brands I have never heard of here, that seem to be pretty big abroad. Every big name is concentrated in the area I live, so it's really cool to walk around and pretend you're rich. At least you can keep up to date with any fashion trends (not that I really dress according to trends, I'm totally unfashionable!). But the prices are just insane. Lacoste, a standard low-end luxury/high-end highstreet brand, is a great example. The price of a Lacoste polo shirt is around 500RMB in England (£47-50 or so). In China it's usually bordering the 900RMB mark. The clothes are made in China! You'd think moving to the source would reduce your expenses, but China has such a huge obsession with wasting money that it is more expensive to shop here!

What I mean by this "wasting money" is that there seems to be no concept of 'value for money' over here. The rich people can shop in the expensive places. But the types of people that are rich in China seem to have so much money that they don't care if they're paying 100% more for their items. It's like the staff can just choose a ridiculously high price for things and it will not effect demand one bit. Demand is very low, that's obvious to anyone who's walked around these derelict malls for more than 5 minutes, but I guess the demand they do have is completely inelastic.

So you can buy a designer shirt for 5000RMB (£500) or pay 2 month's rent in an area the equivalent of Oxford Street. You can a delicious meal at a reasonable chain restaurant (something like Wagamama's or Pizza Express) or you can buy an ice-cream sundae. It's weird!

It's also kind of sad. When you're in China as a western man, things seem pretty easy. At least compared to the UK. People automatically thing you're rich, you're educated, you have good manners, you're generous and attractive. Doesn't matter how horrific you are, if you have white skin you're going to attract some attention from the local Chinese girls. While it sounds like paradise, if you get to thinking about it.. it's thoroughly depressing. If you manage to actually charm a girl, something which I find to be challenging to say the least, you're going to constantly have the idea that maybe she doesn't actually like you. Maybe she's just attracted (or feigning attraction) because of the aforementioned reasons. In England you know where you stand, but in China everyone seems to have predetermined judgements about you. It's like positive racism. Of course there is negative racism, like people acting amazed when you speak the tiniest amount of Chinese (God it's patronizing). That's not exactly having to deal with the KKK or anything.

Going deep into the Chinese psyche is something that will probably take numerous blog posts. It really is an interesting culture in Shanghai, especially how it parallels with some English cultures. But for this short summary, there is definitely a positive/negative, ying/yang, premium/discount when living here. You might be spending more, but you generally don't have to earn a penny to impress people when you're from the west.