Hostname: page-component-74656f9884-j7cmm Total loading time: 0 Render date: 2026-11-07T23:32:57.904Z Has data issue: false hasContentIssue false
  • English
  • Français

VALIDATING CHINA'S OUTPUT DATA USING SATELLITE OBSERVATIONS

Published online by Cambridge University Press:  06 May 2018

Stephen D. Morris  and
Junjie Zhang
Stephen D. Morris*
Affiliation:
Bowdoin College
Junjie Zhang
Affiliation:
Duke Kunshan University, Duke University
*
Address correspondence to: Stephen D. Morris, Bowdoin College, Department of Economics, 9700 College Station, Brunswick, ME 04011, USA; e-mail: smorris@bowdoin.edu.
Rights & Permissions [Opens in a new window]

Abstract

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the 'Save PDF' action button.

Can officially reported output figures be externally validated? This paper presents a dynamic panel framework for assessing statistics using verifiable signals of economic activity. In this context, satellite readings of nitrogen dioxide, a byproduct of combustion, are forwarded. The problem of validating China's reported gross domestic product at the sub-national level during two recent downturns is considered. During the Great Recession period, reported figures are validated for some regions, but not others, including specifically those known to be inaccurate.

Keywords

ChinaGDPNitrogen DioxideNight Lights

Information

Type
Articles
Information
Macroeconomic Dynamics , Volume 23 , Issue 8 , December 2019 , pp. 3327 - 3354
Copyright
Copyright © Cambridge University Press 2018 

Footnotes

The Online Appendix to this paper is available at https://goo.gl/E9G5b8. Data sets are freely available at https://goo.gl/v2Dk4S and replication materials at https://goo.gl/hVrGWD. We thank Qiang Zhang at Tsinghua University for providing the data. We acknowledge funding from the Policy Design and Evaluation Lab at the School of Global Policy and Strategy, UC San Diego and thank seminar participants at Bates College, Bentley University, Bowdoin College, Middlebury College, UC San Diego, the 2014 Workshop in Macroeconomic Research at Liberal Arts Colleges at Wesleyan University, and the 2016 conference “The Environment: Issues and Strategies in China & The U.S” at UC Santa Barbara, as well as many individuals, for productive discussions. Finally, we thank the Associate Editor and two anonymous referees for useful comments. Errors are our own.

References

REFERENCES

Akimoto, H., Ohara, T., Kurokawa, J. ichi, and Horii, N. (2006) Verification of energy consumption in China during 1996–2003 by using satellite observational data. Atmospheric Environment 40 (40), 7663–7667.Google Scholar
Alder, S., Shao, L., and Zilibotti, F. (2016) Economic reforms and industrial policy in a panel of Chinese cities. Journal of Economic Growth 21 (4), 305–349.Google Scholar
Alvarez, J. and Arellano, M. (2003). The time series and cross-section asymptotics of dynamic panel data estimators. Econometrica, 71 (4), 1121–1159.Google Scholar
Anderson, T. W. and Hsiao, C. (1981) Estimation of dynamic models with error components. Journal of the American Statistical Association 76 (375), 598–606.Google Scholar
Arellano, M. and Bond, S. (1991) Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. The Review of Economic Studies 58 (2), 277–297.Google Scholar
Bai, J. (2009) Panel data models with interactive fixed effects. Econometrica 77 (4), 1229–1279.Google Scholar
Batson, A. (2010, December 6) Chinese leader called data “man-made”. Wall Street Journal. Available on: https://www.wsj.com/articles/SB10001424052748704156304576003222932021228.Google Scholar
Berenzin, E., Konovalov, I., Ciais, P., Richter, A., Tao, S., Janssens-Maenhout, G., Beekmann, M., and Schulze, E. D. (2013) Multiannual changes of CO2 emissions in China: Indirect estimates derived from satellite measurements of tropospheric NO2 columns. Atmospheric Chemistry and Physics 13, 9415–9438.Google Scholar
Chang, C., Chen, K., Waggoner, D. F., and Zha, T. (2015) Trends and Cycles in China's Macroeconomy. NBER Working Paper #21244.Google Scholar
Chen, X. and Nordhaus, W. (2011) Using luminosity data as a proxy for economic statistics. Proceedings of the National Academy of Scientists 108 (21), 8589–8594.Google Scholar
Chen, Y., Li, H., and Zhou, L.-A. (2005) Relative performance evaluation and the turnover of provincial leaders in China. Economics Letters 88 (3), 421–425.Google Scholar
Chow, G. (2006) Are Chinese official statistics reliable? CESifo Economic Studies 52 (2), 396–414.Google Scholar
Fernald, J., Malkin, I., and Spiegel, M. (2013) On the reliability of Chinese output figures. Federal Reserve Bank of San Francisco Economic Letter 8, 1–5.Google Scholar
Fernald, J. G., Hsu, E., and Spiegel, M. M. (2015) Is China Fudging its Figures? Evidence from Trading Partner Data. Federal Reserve Bank of San Francisco Working Paper Series #2015-12. Available on: https://www.frbsf.org/economic-research/files/wp2015-12.pdf.Google Scholar
Ghanem, D. and Zhang, J. (2014) “Effortless Perfection:” Do Chinese cities manipulate air pollution data? Journal of Environmental Economics and Management 68 (2), 203–225.Google Scholar
Hahn, J. and Kuersteiner, G. (2002) Asymptotically unbiased inference for a dynamic panel model with fixed effects when both “N” and “T” are large. Econometrica 70 (4), 1639–1657.Google Scholar
Henderson, V., Storeygard, A., and Weil, D. N. (2012) Measuring economic growth from outer space. American Economic Review 102 (2), 994–1028.Google Scholar
Holtz-Eakin, D., Newey, W., and Rosen, H. S. (1988) Estimating vector autoregressions with panel data. Econometrica, 56 (6), 1371–1395.Google Scholar
Holz, C. A. (2014) The quality of China's GDP statistics. China Economic Review 30, 309–338.Google Scholar
Horowitz, J. L. (2001) The bootstrap. Handbook of Econometrics 5, 3159–28.Google Scholar
Itahashi, S., Uno, I., Irie, H., Kurokawa, J.-I., and Ohara, T. (2014) Regional modeling of tropospheric NO2 vertical column density over East Asia during the period 2000–2010: Comparison with multisatellite observations. Atmospheric Chemistry and Physics 14 (7), 3623–3635.Google Scholar
Koch-Weser, I. N. (2013) The reliability of China's economic data: An analysis of national output. US-China Economic and Security Review Commission Staff Research Project, 1–32. Available on: https://www.uscc.gov/sites/default/files/Research/TheReliabilityofChina%27sEconomicData.pdf.Google Scholar
Koech, J. and Wang, J. (2012) China's slowdown may be worse than official data suggest. Federal Reserve Bank of Dallas Economic Letter 7 (8), 1–4.Google Scholar
Lin, J.-T. and McElroy, M. B. (2011) Detection from space of a reduction in anthropogenic emissions of nitrogen oxides during the Chinese economic downturn. Atmospheric Chemistry and Physics 11 (15), 8171–8188.Google Scholar
Liu, M. (2009, September 25) The competition within China's single party. Newsweek.Google Scholar
Liu, Z., Guan, D., Wei, W., Davis, S. J., Ciais, P., Bai, J., Peng, S., Zhang, Q., Hubacek, K., Marland, G., Andres, R. J., Crawford-Brown, D., Lin, J., Zhao, H., Hong, C., Boden, T. A., Feng, K., Peters, G. P., Xi, F., Liu, J., Li, Y., Zhao, Y., Zeng, N., He, K.. (2015) Reduced carbon emission estimates from fossil fuel combustion and cement production in China. Nature 524 (7565), 335–338.Google Scholar
Nakamura, E., Steinsson, J., and Liu, M. (2016) Are Chinese growth and inflation too smooth? Evidence from Engel curves. American Economics Journal: Macroeconomics 8 (3), 113–144.Google Scholar
Neyman, J. and Scott, E. L. (1948) Consistent estimates based on partially consistent observations. Econometrica 16 (1), 1–32.Google Scholar
Nickell, S. (1981) Biases in dynamic models with fixed effects. Econometrica 49 (6), 1417–1426.Google Scholar
Rawski, T. G. (2001) What is happening to China's GDP statistics? China Economic Review 12 (4), 347–354.Google Scholar
Sargent, T. J. (1989) Two models of measurements and the investment accelerator. Journal of Political Economy 97, 251–287.Google Scholar
Sinton, J. E. (2002) Accuracy and reliability of China's energy statistics. China Economic Review 12, 373–383.Google Scholar
Wallace, J. L. (2014) Juking the stats? Authoritarian information problems in China. British Journal of Political Science 46 (1), 1–19.Google Scholar
Wang, S., Zhang, Q., Streets, D., He, K., Martin, R., Lamsal, L., Chen, D., Lei, Y., and Lu, Z. (2012) Growth in NOx emissions from power plants in China: Bottom-up estimates and satellite observations. Atmospheric Chemistry and Physics 12 (10), 4429–4447.Google Scholar
Supplementary material: PDF

Morris and Zhang supplementary material

Online Appendix

Download Morris and Zhang supplementary material(PDF)
PDF 1.4 MB