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The quality of China's GDP statistics

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  • Holz, Carsten A.

Abstract

Since the 1998 “wind of falsification and embellishment,” Chinese official statistics on gross domestic product (GDP) have repeatedly come under scrutiny. This paper evaluates the quality of China's GDP statistics in four stages. First, it reviews past and ongoing suspicions of the quality of GDP data and examines the evidence. Second, it documents the institutional framework for data compilation and concludes on the implications for data quality. Third, it asks how the Chinese National Bureau of Statistics could possibly go about credibly falsifying GDP data without being found out. Fourth, it examines if the first- and second-digit distributions of official GDP data conform to established data regularities (Benford's Law). The findings are that the supposed evidence for GDP data falsification is not compelling, that the National Bureau of Statistics has much institutional scope for falsifying GDP data, and that certain manipulations of nominal and real data would be virtually undetectable. Official GDP data, however, exhibit few statistical anomalies (conform to Benford's Law) and the National Bureau of Statistics thus either makes no significant use of its scope to falsify data, or is aware of statistical data regularities when it falsifies data.

Suggested Citation

  • Holz, Carsten A., 2014. "The quality of China's GDP statistics," China Economic Review, Elsevier, vol. 30(C), pages 309-338.
  • Handle: RePEc:eee:chieco:v:30:y:2014:i:c:p:309-338
    DOI: 10.1016/j.chieco.2014.06.009
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    Cited by:

    1. Chen, Changsheng & Girardin, Eric & Mehrotra, Aaron, 2017. "Global slack and open economy Phillips curves – A province-level view from China," China Economic Review, Elsevier, vol. 42(C), pages 74-87.
    2. repec:eee:jcecon:v:45:y:2017:i:2:p:304-324 is not listed on IDEAS
    3. Hunter Clark & Maxim Pinkovskiy & Xavier Sala-i-Martin, 2017. "China's GDP Growth May be Understated," NBER Working Papers 23323, National Bureau of Economic Research, Inc.
    4. Cross, Jamie & Nguyen, Bao H., 2017. "The relationship between global oil price shocks and China's output: A time-varying analysis," Energy Economics, Elsevier, vol. 62(C), pages 79-91.
    5. repec:bla:worlde:v:40:y:2017:i:11:p:2455-2474 is not listed on IDEAS
    6. Shuaizhang Feng & Yingyao Hu & Robert Moffitt, 2015. "Long Run Trends in Unemployment and Labor Force Participation in China," Working Papers id:7279, eSocialSciences.
    7. Shiyu Li & Laurence J. Kotlikoff & Shuanglin Lin & Wing Thye Woo & Yunyun Jiang, 2016. "How Much Will China Save? Projecting China's National Savings Through 2040," Asian Economic Journal, East Asian Economic Association, vol. 30(3), pages 255-274, September.
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    10. Pang, Ke & Siklos, Pierre L., 2016. "Macroeconomic consequences of the real-financial nexus: Imbalances and spillovers between China and the U.S," Journal of International Money and Finance, Elsevier, vol. 65(C), pages 195-212.
    11. Gooch, Elizabeth, 2017. "Estimating the Long-Term Impact of the Great Chinese Famine (1959–61) on Modern China," World Development, Elsevier, vol. 89(C), pages 140-151.
    12. Paul G. Egan & Anthony J. Leddin, 2016. "Examining Monetary Policy Transmission in the People's Republic of China–Structural Change Models with a Monetary Policy Index," Asian Development Review, MIT Press, vol. 33(1), pages 74-110, March.
    13. repec:eee:rensus:v:74:y:2017:i:c:p:186-200 is not listed on IDEAS
    14. repec:eee:enepol:v:121:y:2018:i:c:p:211-216 is not listed on IDEAS
    15. Jong-Wha Lee, 2017. "China's economic growth and convergence," The World Economy, Wiley Blackwell, vol. 40(11), pages 2455-2474, November.
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    17. repec:eee:wdevel:v:105:y:2018:i:c:p:83-94 is not listed on IDEAS
    18. Tariq Ahmad Mir & Marcel Ausloos & Roy Cerqueti, 2014. "Benford's law predicted digit distribution of aggregated income taxes: the surprising conformity of Italian cities and regions," Papers 1410.2890, arXiv.org.
    19. repec:eee:chieco:v:48:y:2018:i:c:p:102-113 is not listed on IDEAS

    More about this item

    Keywords

    Accuracy of national statistics; National income accounting; Compilation of GDP and sectoral value-added; National statistical system; Benford's Law;

    JEL classification:

    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • P27 - Economic Systems - - Socialist Systems and Transition Economies - - - Performance and Prospects
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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