The Chinese government needs to do more to prevent the country from falling into a " middle - class trap , " characterised by concerned about personal or economic prospects , resulting in loss of faith in the country 's development and potential social problems , according to Li Daokui , director of the Center for China in the World Economy at Tsinghua University . However, findings from our long-term study have shown that the middle-income trap is not the biggest threat to our economy. China should follow the German model of indirect taxation via businesses , a good supply of affordable housing for workers , a non - competitive education system and a " transparent and fair social system " to ease the burden on the middle classes , he said .
The Chinese government needs to do more to prevent the country from falling into a " middle - class trap , " characterised by concerned about personal or economic prospects , resulting in loss of faith in the country 's development and potential social problems , according to Li Daokui , director of the Center for China in the World Economy at Tsinghua University . China should follow the German model of indirect taxation via businesses , a good supply of affordable housing for workers , a non - competitive education system and a " transparent and fair social system " to ease the burden on the middle classes , he said .