IDEAS home Printed from https://ideas.repec.org/p/ess/wpaper/id2777.html
   My bibliography  Save this paper

What Can Be Learned About the Economies of China and India from Purchasing Power Comparisons?

Author

Listed:
  • Alan Heston

Abstract

Comparisons of India and China have been made for over 50 years. This paper focuses on purchasing power estimates in China and India in the 2005 round of the UN International Comparison Programme (ICP) that was coordinated by the World Bank, the Regional Banks and Economic Commissions. The 2005 ICP round provides estimates of purchasing power parities (PPPs) of currencies and real product per capita for 146 countries, and the results for China and India are discussed in the context of the size of these economies. It also provides insights into the prospects of future economic growth in China and India as also policy recommendations for China and the likely scenarios in the future. [Working Paper No. 229]

Suggested Citation

  • Alan Heston, 2010. "What Can Be Learned About the Economies of China and India from Purchasing Power Comparisons?," Working Papers id:2777, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:2777
    Note: Institutional Papers
    as

    Download full text from publisher

    File URL: http://www.esocialsciences.org/Download/repecDownload.aspx?fname=Document12082010300.4771387.pdf&fcategory=Articles&AId=2777&fref=repec
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Chen, Shaohua & Ravallion, Martin, 2008. "China is poorer than we thought, but no less successful in the fight against poverty," Policy Research Working Paper Series 4621, The World Bank.
    2. World Bank, 2008. "Global Purchasing Power Parities and Real Expenditures : 2005 International Comparison Program," World Bank Publications - Books, The World Bank Group, number 21558, December.
    3. Brandt,Loren & Rawski,Thomas G. (ed.), 2008. "China's Great Economic Transformation," Cambridge Books, Cambridge University Press, number 9780521885577.
    4. Kravis, Irving B., 1981. "An approximation of the relative real per capita GDP of the People's Republic of China," Journal of Comparative Economics, Elsevier, vol. 5(1), pages 60-78, March.
    5. Mrs. Poonam Gupta & Mr. James P. F. Gordon, 2004. "Understanding India’s Services Revolution," IMF Working Papers 2004/171, International Monetary Fund.
    6. Clark, Colin, 1976. "Economic Development in Communist China," Journal of Political Economy, University of Chicago Press, vol. 84(2), pages 239-264, April.
    7. Carsten A. Holz, 2006. "China'S Reform Period Economic Growth: How Reliable Are Angus Maddison'S Estimates? Response To Angus Maddison'S Reply," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 52(3), pages 471-475, September.
    8. Richard Herd & Sean Dougherty, 2007. "Growth Prospects in China and India Compared," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 4(1), pages 65-89, June.
    9. Robert C. Feenstra & Alan Heston & Marcel P. Timmer & Haiyan Deng, 2009. "Estimating Real Production and Expenditures across Nations: A Proposal for Improving the Penn World Tables," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 201-212, February.
    10. Brandt,Loren & Rawski,Thomas G. (ed.), 2008. "China's Great Economic Transformation," Cambridge Books, Cambridge University Press, number 9780521712903.
    11. Bart van Ark & Abdul Azeez Erumban & Vivian Chen & Utsav Kumar, 2009. "the Cost Competitiveness of the Manufacturing Sector in China and India: An Industry and Regional Perspective," Economics Program Working Papers 09-02, The Conference Board, Economics Program.
    12. Heston, Alan & Nuxoll, Daniel A & Summers, Robert, 1994. "The Differential-Productivity Hypothesis and Purchasing-Power Parties: Some New Evidence," Review of International Economics, Wiley Blackwell, vol. 2(3), pages 227-243, October.
    13. Carsten A. Holz, 2006. "CHINA's REFORM PERIOD ECONOMIC GROWTH: HOW RELIABLE ARE ANGUS MADDISON's ESTIMATES?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 52(1), pages 85-119, March.
    14. Shaohua Chen & Martin Ravallion, 2010. "The Developing World is Poorer than We Thought, But No Less Successful in the Fight Against Poverty," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(4), pages 1577-1625.
    15. Bart Van Ark & Abdul Azeez & Erumban Vivian Chen & Chen Utsav Kumar, "undated". "The Cost Competitiveness of Manufacturing in China and India: An Industry and Regional Perspective," Indian Council for Research on International Economic Relations, New Delhi Working Papers 228, Indian Council for Research on International Economic Relations, New Delhi, India.
    16. Brandt, Loren & Holz, Carsten A, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 43-86, October.
    17. Barry Eichengreen & Ricardo Hausmann, 1999. "Exchange rates and financial fragility," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 329-368.
    18. Swamy, Subramanian, 1973. "Economic Growth in China and India, 1952-1970: A Comparative Appraisal," Economic Development and Cultural Change, University of Chicago Press, vol. 21(4), pages 1-84, Part II J.
    19. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    20. Barry Bosworth & Susan M. Collins, 2008. "Accounting for Growth: Comparing China and India," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 45-66, Winter.
    21. repec:dgr:rugggd:gd-95 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Przemyslaw Kowalski, 2008. "China and India - A Tale of Two Trade Integration Approaches," Trade Working Papers 22170, East Asian Bureau of Economic Research.
    2. Deng, Kent & O’Brien, Patrick Karl, 2016. "China’s GDP per capita from the Han Dynasty to communist times," Economic History Working Papers 64857, London School of Economics and Political Science, Department of Economic History.
    3. Xu, Yingfeng & Yan, Xiaoyi, 2009. "The Role of the Real Exchange Rate Adjustment in Expanding Service Employment in China," Working Papers 2009-11, University of Alberta, Department of Economics.
    4. Kent Deng & Patrick Karl O’Brien, 2014. "Creative Destruction: Chinese GDP per capita from the Han Dynasty to Modern Times," Working Papers 0063, European Historical Economics Society (EHES).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. John Knight & Sai Ding, 2008. "Why has China Grown so Fast? The Role of Structural Change," Economics Series Working Papers 415, University of Oxford, Department of Economics.
    2. Kerola, Eeva, 2018. "In search of fluctuations : Another look at China’s incredibly stable GDP growth," BOFIT Discussion Papers 23/2018, Bank of Finland, Institute for Economies in Transition.
    3. Almås, Ingvild & Johnsen, Åshild Auglænd, 2012. "The cost of living in China: Implications for inequality and poverty," Discussion Paper Series in Economics 21/2012, Norwegian School of Economics, Department of Economics.
    4. Robert J. Hill & Iqbal A. Syed, 2012. "Accounting for Unrepresentative Products and Urban-Rural Price Differences in International Comparisons of Real Income: An Application to the Asia-Pacific Region," Graz Economics Papers 2012-07, University of Graz, Department of Economics.
    5. Angus Deaton & Alan Heston, 2010. "Understanding PPPs and PPP-Based National Accounts," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(4), pages 1-35, October.
    6. Facundo Alvaredo & Leonardo Gasparini, 2013. "Recent Trends in Inequality and Poverty in Developing Countries," CEDLAS, Working Papers 0151, CEDLAS, Universidad Nacional de La Plata.
    7. Ingvild Almas & Ashild Johnsen, 2018. "The cost of a growth miracle - reassessing price and poverty trends in China," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 30, pages 239-264, October.
    8. Almås, Ingvild & Johnsen, Åshild Auglænd & Kotsadam, Andreaa, 2014. "Poverty in China Seen from Outer Space," Memorandum 11/2014, Oslo University, Department of Economics.
    9. Gustafsson, Björn Anders & Sai, Ding, 2008. "Temporary and Persistent Poverty among Ethnic Minorities and the Majority in Rural China," IZA Discussion Papers 3791, Institute of Labor Economics (IZA).
    10. repec:zbw:bofitp:2018_023 is not listed on IDEAS
    11. Kwan, Fung & Zhang, Yang & Zhuo, Shuaihe, 2018. "Labour reallocation, productivity growth and dualism: The case of China," International Review of Economics & Finance, Elsevier, vol. 57(C), pages 198-210.
    12. Zhang, Chunni & Xu, Qi & Zhou, Xiang & Zhang, Xiaobo & Xie, Yu, 2014. "Are poverty rates underestimated in China? New evidence from four recent surveys," China Economic Review, Elsevier, vol. 31(C), pages 410-425.
    13. Celine Bonnefond, 2014. "Growth Dynamics And Conditional Convergence Among Chinese Provinces: A Panel Data Investigation Using System Gmm Estimator," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 39(4), pages 1-25, December.
    14. Loren Brandt & Debin Ma & Thomas G. Rawski, 2014. "From Divergence to Convergence: Reevaluating the History behind China's Economic Boom," Journal of Economic Literature, American Economic Association, vol. 52(1), pages 45-123, March.
    15. Ravallion, Martin, 2009. "Are There Lessons for Africa from China's Success Against Poverty?," World Development, Elsevier, vol. 37(2), pages 303-313, February.
    16. Shahid Yusuf & Kaoru Nabeshima, 2009. "Growth through Innovation : An Industrial Strategy for Shanghai," World Bank Publications - Reports 18613, The World Bank Group.
    17. Jing You, 2014. "Dietary change, nutrient transition and food security in fast-growing China," Chapters, in: Raghbendra Jha & Raghav Gaiha & Anil B. Deolalikar (ed.), Handbook on Food, chapter 9, pages 204-245, Edward Elgar Publishing.
    18. Longfeng Ye & Peter E. Robertson, 2017. "Migration and Growth in China: A Sceptical Assessment of the Evidence," Economics Discussion / Working Papers 17-03, The University of Western Australia, Department of Economics.
    19. Thomas Piketty & Li Yang & Gabriel Zucman, 2019. "Capital Accumulation, Private Property, and Rising Inequality in China, 1978–2015," American Economic Review, American Economic Association, vol. 109(7), pages 2469-2496, July.
    20. Scherngell, Thomas & Borowiecki, Martin & Hu, Yuanjia, 2014. "Effects of knowledge capital on total factor productivity in China: A spatial econometric perspective," China Economic Review, Elsevier, vol. 29(C), pages 82-94.
    21. Molero-Simarro, Ricardo, 2017. "Inequality in China revisited. The effect of functional distribution of income on urban top incomes, the urban-rural gap and the Gini index, 1978–2015," China Economic Review, Elsevier, vol. 42(C), pages 101-117.

    More about this item

    Keywords

    purchasing power; China; India; economic growth; tertiary sector; capital stock;
    All these keywords.

    JEL classification:

    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ess:wpaper:id:2777. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Padma Prakash (email available below). General contact details of provider: http://www.esocialsciences.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.