Article:http://www.nytimes.com/2014/10/06/business/international/hong-kong-wealth-gap-on-display-in-protests.html?src=me
In this article the writer talks about the Hong Kong economy, its relevance to China’s economy and what is the problem in Hong Kong at this present moment.
Having been a British Colony for 155 years Hong Kong was then given back to China and since then has acted as China’s main contact point for foreigners. With this the elite have become even more elite as prices go up, and only these elites can afford to invest. However, the average folk are the casualties, as prices rocket up and wages stay relatively same the average person can no longer afford a comfortable living or have the chance to break into the elite.
This is where the political unrest came in as one of the major investments real estate is set by the government which means the elite are the only ones able to afford it as the price floor is above the equilibrium point. This means more people are homeless than say if the market was allowed develop by it self.
This idea came as a surprise to me becaues I have always viewed Hong Kong as liberal, and market driven. The idea that so much economic control there really is in the real estate busienss is a shock. It gives a new perspective on why Hong Kong youth want a democratic government (if the situation stayed the same with rising real estate less and less people aka todays youth would not be able to afford housing) I had not realized the wealth gap between the elite and average person was so wide.
Another interesting thing to note is how closely related political and economical issues are closely related.