China’s slowdown last year probably didn’t exceed government reports, researchers at the Federal Reserve Bank of San Francisco said, differing from concerns voiced by some analysts about the accuracy of the official data.
The expansion of gross domestic product reported by the world’s second-largest economy paralleled other indicators of growth, including electricity production, rail shipments and lending, the Fed researchers said today in a paper describing their comparison of official and independent economic data.
“We find no evidence that China’s slowdown in 2012 was greater than officially reported,” the researchers said in their paper. “Output data are systematically related to alternative indicators of Chinese economic activity.”
An economist at Standard Chartered Plc said last month China may underestimate price increases in services industries, meaning inflation-adjusted growth was lower last year than official data indicate. Stephen Green, head of Greater China research at Standard Chartered in Hong Kong, provided in a report a “guesstimate” of 5.5 percent growth for 2012, compared with the official reading of 7.8 percent.
China’s “statistical system is evolving and they’re improving their ability to measure output,” said Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics in Washington.
“Unless you have some real solid reason for thinking that the numbers are getting cooked one way or another, you’re better off relying on the official data,” said Lardy, author of the book, “Sustaining China’s Economic Growth after the Global Financial Crisis.”
China’s growth slowed for seven quarters before recovering to a 7.9 percent annual pace in the final three months of 2012, led by government-directed spending on infrastructure. The economy will probably grow 8.1 percent this year, according to the median estimate of 51 economists in a March 15-20 Bloomberg survey.
The San Francisco Fed report cited Li Keqiang, who was made China’s premier this month and was quoted in 2007 as saying he monitored data on power, rail cargo and loans because GDP data were “man-made.” Li’s remark in a leaked diplomatic cable was published by WikiLeaks in 2010.
The San Francisco Fed researchers -- John Fernald, Israel Malkin and Mark Spiegel -- also tracked consumer sentiment, construction of new floor space, raw materials use, airline passenger volume and new residential real estate construction. They examined data on China’s imports and exports produced by non-Chinese sources.