Is China Fudging Its GDP Figures? The SF Fed Weighs In

It is the million (or trillion dollar question).

There are signs that China is, and has been, fudging its GDP figures according to a working paper from the Federal Reserve Bank of San Francisco.

The paper, titled Is China Fudging its Figures? Evidence from Trading Partner Data, and written by John Fernald, Eric Hsu, and Mark M. Spiegel Federal Reserve Bank of San Francisco uses trading partner data as a proxy for GDP growth, comparing the proxy figures to the government’s official GDP numbers. This is only a summary, the full paper can be found at the link above.

Past studies have shown that import/export figures are a reliable indicator of economic activity for many countries. More importantly, import/export data from China’s major trading partners...