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​A Forensic Examination of China’s National Accounts

Date/Time: 26-Nov-2019 1030hrs - 1200hrs
Venue: Executive Seminar Room 2 (S3.1-B1-02/03)
Contact Information:

​Meiqin at 

Division of Banking & Finance

A Forensic Examination of China’s National Accounts

Zheng (Michael) Song
Chinese University of Hong Kong

Tuesday, 26 November 2019
10.30 am – 12.00 pm
Executive Seminar Room 2 (S3.1-B1-02/03)

Chairperson:  Asst Prof Ru Hong

China’s national accounts are based on data collected by local governments. However, since local governments are rewarded for meeting growth and investment targets, they have an incentive to skew local statistics. China’s National Bureau of Statistics (NBS) adjusts the data provided by local governments to calculate GDP at the national level. The adjustments made by the NBS average 5% of GDP since the mid-2000s. On the production side, the discrepancy between local and aggregate GDP is entirely driven by the gap between local and national estimates of industrial output. On the expenditure side, the gap is in investment. Local statistics increasingly misrepresent the true numbers after 2008, but there was no corresponding change in the adjustment made by the NBS. Using publicly available data, we provide revised estimates of local and national GDP by re-estimating output of industrial, construction, wholesale and retail firms using data on value-added taxes. We also use several local economic indicators that are less likely to be manipulated by local governments to estimate local and aggregate GDP. The estimates also suggest that the adjustments by the NBS were insufficient after 2008. Relative to the official numbers, we estimate that GDP growth from 2010-2016 is 1.8 percentage points lower and the investment and savings rate in 2016 is 7 percentage points lower.

About the Speaker
Professor Song is a professor at the Department of Economics, Chinese University of Hong Kong (CUHK), the director of CUHK-Tsinghua Joint Research Center for Chinese Economy, a distinguished visiting professor at the School of Economics and Management, Tsinghua University and special-term professor at School of Entrepreneurship and Management, ShanghaiTech University. Before joining CUHK, he was an associate professor of economics at Chicago Booth. Prof. Song is a co-editor of China Economic Review and associate editor of Econometrica and Journal of European Economic Association. His research focuses on Chinese economy and macroeconomics. His papers appear on leading academic journals including American Economic Review and Econometrica. In 2013, he won Sunyefang Economic Science Award.

For further information and enquiries, please contact Meiqin at 
Nanyang Business School, Nanyang Technological University, Block S3, 50 Nanyang Avenue, Singapore 639798

Published on: 22-Nov-2019

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