China's reputation as a low-cost manufacturer hasn't translated into low-cost prices. Many goods, particularly luxury items, have higher price tags in China than abroad. One economist blames the transportation system and corruption.
Industrial geography in today's climate shows that China has clear economic advantages over most of the world to manufacture good cheaply. Why would this not necessarily translate to cheap consumer goods for China's domestic market? High taxes, steep internal shipping costs and a market flooded with knock-offs all contribute to this paradox.
Via Seth Dixon