If products were priced in people/hours then your premise would be true.
Having an american machine a part @$50/hour is, in this paper's terms, less productive than a chinese use a file to make a part for $3/day. So, the american costs $50 and the chinese costs $9. So, the chinese is clearly better? But, if you compare 1 hour with 36 hours?
And lets compare toasters. The $19.95 wallymart special cost about $2 to make. That $100 fancy toaster cost about $3 to make. How do you apply more for less to that? Especially since, in the store, product design is everything, and product durability is nothing.
The biggest stumbling block to this thesis is that everyone has to be assumed to doing something that pays. In that case, the cheaper the better. But homeless people cannot buy televisions, even though they are the cheapest per size they have ever been.
An artist will spend as much time as needed to create their piece. And often the value of the piece will have no bearing on the input of time or resources.
RE: Productivity, Growth, and Trade: A Little Freedom Goes A Long Way