 Chasing or cheating? Theory and evidence on China's GDP manipulationShuo Chen, Xue Qiao and Zhitao Zhu Journal of Economic Behavior & Organization, 2021, vol. 189, issue C, 657-671 Abstract: This paper studies the effect of promotion incentive on county officials’ GDP manipulation in China, both theoretically and empirically. We employ satellite nightlight data to estimate a proxy for GDP manipulation. Our difference-in-difference estimation explores the variation in political turnovers across counties during the local party congresses between 2006 and 2007. We find that county officials who are in the early period of their tenure and thus expect a higher chance of being promoted, undertake more cheating effort to manipulate GDP than those in the later period. Furthermore, we find that the impact of promotion incentive on GDP manipulation is smaller in counties where local officials are subject to stronger accountability, either from their superiors or from the grassroots. These results are not only consistent with the model predictions, but also state that the lauded merit-based promotion system in China could lead to systematic GDP manipulation, which may induce information distortion problem. Keywords: GDP manipulation; Promotion incentive; Political turnover; Accountability (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:189:y:2021:i:c:p:657-671 DOI: 10.1016/j.jebo.2021.07.010 Access Statistics for this article Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D. More articles in Journal of Economic Behavior & Organization from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.