Disposable income grew twice as fast as the economy in the 2000s, and so did consumption. The increase in living standards was partly achieved at the cost of investment. Although investment in new factories and equipment increased from 15% of GDP in 2000 to the current 23%, it was well below the level of even Soviet investment in capital stock, not to mention China’s. And as Natalia Orlova of Alfa Bank notes, half of all new construction in the pre-recession years was of shopping centres, rather than the factories that could fill those shops with goods.
