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Gross Domestic Products (GDP) is not a Proper Indicator of Measurement and Economic Power Comparison for Emerging Economies: A Judgement from International Distributions of Net Factor Income from Abroad

Author

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  • Dong Qiu

    (School of Statistics, Jiangxi University of Finance and Economics, Nanchang, China)

  • Yafei Wang

    (School of Statistics, Beijing Normal University, Beijing, China)

Abstract

Global distributions of net factor income from abroad (NFI) during 1990-2019 have witnessed that (1) the United States is the top one country accounting for 40% of surpluses of the global total, while a surge in China’s deficit with its GDP increase; (2) GDP growth in emerging economies has a price scissors with NFI deficits; (3) asymmetric NFI has covered up the severity of rich countries’ global arbitrages especially from emerging economies; (4) China’s economic power is exaggerated by the PPP-based GDP implemented by the World Bank. It concludes that (1) developing countries have paid for huge hidden cost for their emergence; (2) the statement of the United States suffering losses absolutely does not hold; (3) GDP is not a universal tool for measuring what matters. It suggests that (1) emerging economies countries should beware of the potential misleading of GDP on economic measurement and economic power comparison ; (2) GDP should be critiqued from the applicability perspective of economies’ types; (3) it is urgent to clarify some misjudgment and misleading concepts in the economic affairs surrounding the global value chain patterns; (4) the construction of national governance capacity in emerging economies should focus on “social infrastructure”, of which one of the important parts is an effective economic statistics system; (5) emerging economies should carry out the strategic layout of international economic statistics talents to enhance their soft powers.

Suggested Citation

  • Dong Qiu & Yafei Wang, 2023. "Gross Domestic Products (GDP) is not a Proper Indicator of Measurement and Economic Power Comparison for Emerging Economies: A Judgement from International Distributions of Net Factor Income from Abro," Journal of Economic Statistics, Anser Press, vol. 1(1), pages 1-44, February.
    • Handle: RePEc:bba:j00005:v:1:y:2023:i:1:p:1-44:d:114
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    References listed on IDEAS

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    6. Carol S. Carson, 1975. "The History Of The United States National Income And Product Accounts: The Development Of An Analytical Tool," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 21(2), pages 153-181, June.
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