Is China fudging its GDP figures? Evidence from trading partner data

John Fernald (), Eric Hsu and Mark Spiegel

Journal of International Money and Finance, 2021, vol. 110, issue C

Abstract: We use Chinese imports, measured as reported exports of trading partners, as a benchmark to gauge the accuracy of alternative Chinese indicators (including GDP) of fluctuations in economic activity. Externally-reported imports are likely to be relatively well-measured and free from domestic manipulation. Using principal components, we derive activity indices from a wide range of indicators. We choose a preferred index of eight non-GDP indicators based on their fit to Chinese imports, which we call the China Cyclical Activity Tracker (or C-CAT). We find that Chinese statistics have broadly become more reliable in measuring cyclical fluctuations over time. However, measured GDP has been excessively smooth since 2013, and adds little information relative to combinations of other indicators.

Keywords: China; GDP; Principal components; Structural break; Forecasting (search for similar items in EconPapers)
JEL-codes: C53 C82 E20 F17 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:110:y:2021:i:c:s0261560620302187

DOI: 10.1016/j.jimonfin.2020.102262

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