China's GDP Growth May Be Understated

45 Pages Posted: 17 Apr 2017

See all articles by Hunter L. Clark

Hunter L. Clark

Federal Reserve Banks - Federal Reserve Bank of New York

Maxim Pinkovskiy

Federal Reserve Bank of New York

Xavier Sala-i-Martin

Columbia University, Graduate School of Arts and Sciences, Department of Economics

Date Written: April 2017

Abstract

Concerns about the quality of China’s official GDP statistics have been a perennial question in understanding its economic dynamics. We use data on satellite-recorded nighttime lights as an independent benchmark for comparing various published indicators of the state of the Chinese economy. Using the methodology of Pinkovskiy and Sala-i-Martin (2016a and b), we exploit nighttime lights to compute the optimal weights for various Chinese economic indicators in a best unbiased predictor of Chinese growth rates. Our computations of Chinese growth based on optimal weightings of various combinations of economic indicators provide evidence against the hypothesis that the Chinese economy contracted precipitously in late 2015, and are consistent with the rate of Chinese growth being higher than is reported in the official statistics.

Suggested Citation

Clark, Hunter L. and Pinkovskiy, Maxim and Sala-i-Martin, Francesc Xavier, China's GDP Growth May Be Understated (April 2017). NBER Working Paper No. w23323. Available at SSRN: https://ssrn.com/abstract=2953810

Hunter L. Clark (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Maxim Pinkovskiy

Federal Reserve Bank of New York ( email )

Francesc Xavier Sala-i-Martin

Columbia University, Graduate School of Arts and Sciences, Department of Economics ( email )

420 W. 118th Street
New York, NY 10027
United States
212-854-7055 (Phone)

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
45
Abstract Views
471
PlumX Metrics