HOMEMASS MEDIAXavier in the NewsShining a Bright Light on Dodgy Chinese Data
27 April 2017
Shining a Bright Light on Dodgy Chinese Data
Mass media - News Sala i Martín
Wall Street Journal
  
 

Tags: Competitiveness

GDP data is thought to be unreliable but new estimates from a surprising source hint that the recent uptick isn’t pure fiction

Nathaniel Taplin | Wall Street Journal

The mysterious stability of China’s official GDP figures—which have remained stubbornly range-bound even as commodity prices and corporate profits have fluctuated wildly—has long been a source of frustration among China watchers.

Now a trio of New York economists may have discovered a solution: just turn out the lights. Watching nighttime satellite data to see how quickly Chinese cities brighten over time may be at least as good a measure of growth as popular metrics like the “ Li Keqiang index,” derived from the current Chinese premier’s famous comment casting doubt on official GDP figures. One result of interest to investors: The data appear to validate the recent uptick in growth hinted at by corporate profits and rebounding inflation, although they also hint that economic activity may have slowed somewhat more sharply than officially acknowledged in late 2014 and early 2015.

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