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Why do low-income earners tend to spend more?
I am reading an article in the Economist. It is discussing the China's unbalanced economy especially the lower household consumption proportion in GDP than the global average. The writer thinks the poor social safety net in China plays a part in curbing the household consumption. Then follows the below sentence. As low-income earners have a higher propensity to spend, the lack of support weighs on consumption more generally. I don't quite understand why low-income earners have a higher tendency to consume. I can't find any other supporting details in the article as if the writer takes it as a common sense. Anybody could help to shed some light on it? Thanks.
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