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Researcher: China May Have Inflated Its GDP By 30 Percent

Luis Martinez, Assistant Professor at the University of Chicago, published a research paper with a model to analyze a country’s economy. He used the brightness of lights at night from satellite images as a proxy indicator of economic activity. Martinez reasoned that more economic development leads to more infrastructure development, including more streetlights and buildings and more lights. He then compared the stable and credible democracy countries to authoritarian regimes and found that the latter overstate their economy by 30 to 35 percent.

Martinez’s model showed that China’s might have exaggerated its GDP by one-third.

A 2019 report by the Brookings Institution was in agreement with Martinez’s conclusion. It suggested that China overstated its economic growth by 2 percent each year and thus its actual economic volume was 12 percent smaller than the official number.

Source: VOA, November 1, 2022