Overseas Property Mall

Shanghai skyline, Photo: Overseas Property Mall

A couple mornings ago I woke up to the voice of Huang Yasheng, an MIT Sloan professor who was being interviewed on NPR’s “Morning Edition.” The segment was about how Shanghai’s glittering skyline may be masking serious economic troubles, among them, a deepening real estate slump. One person interviewed said that problems in the property market were just a regular dip, but the Sloan prof said that the rise of sky scrapers and housing vacancies were much more ominous–they exposed weaknesses in the interventionist, top-down style of Chinese capitalism.

“The way that China has urbanized is overbuilt, overinvested without making average people rich… Developers get rich, government officials get rich. Essentially you have a building boom, you have property development, but because the land prices are controlled by the government, the people don’t get that much from the building boom.”

Have you been to Shanghai? What’s your take?

Listen to the NPR broadcast.