As someone who has taught chemistry for the past 5+ years, thank you for going over precision vs. accuracy, and significant figures! Nice to see it being used outside of the traditional sciences. Edit: precession to precision
One caution with the "GDP per capita" numbers is that China is basically multiple countries in one. If you look at the coastal provinces (Beijing, Shanghai, Jiangsu, Fujian, Tianjin, Zhejiang, Guangdong), they have a GDP per capita similar to other advanced economies, especially if you adjust for PPP. Whereas the internal provinces have GDP per capita that hover around the poverty line.
You'd think that would be common sense since it works the same way in most countries, like Australia and the US for example. Economic activity is focused around major cities on coastlines and always has been, with numbers generally ramping down as you go inland.
@@Luke-xv7xo BIG difference between the US urban/rural divide and the Chinese urban/rural divide, literally two separate worlds in the latter case. Rural areas are basically stuck back 50 or 60 years behind doing subsistence agriculture.
@@icouldntthinkofaname379you're just saying the same thing as OP lol, like yeah there's a clear distinction but it still works the same way. cities = money, rural = a lot less money, it's universal.
5:22 For the love of god, please don't round it until you get to the final answer. If you're rounding at every step then you will potentially have huge errors.
Fermi problems/approximations are good for setting upper and lower bounds, usually within an order of magnitude when full data sets are not available to answer a question. a classic example is _"how many piano tuners are there in chicago."_ Or _"how many cups of water are there in a bath tub?"_ Physicists and engineers often use them to make quick approximations, but are under no delusions they are to be used for real calculations when those are required. Not what you are referring, but still something I recommend familiarizing if you are not already.
I think that one thing this video makes clear is that economists - even large, important organizations of them - aren't necessarily good statisticians. :)
You can round off like that when - with the data itself - it is not possible to be so precise, which makes it more inaccurate to not round it off. Also, he is not talking about every step, probably just the answer. But for the most part you're right ofcourse!
No you actually should. Rounding to the millions place when you are talking about trillions is just a bad move. Rounding to the billions place means that the real number is within a half billion more or less, The error is at most .05% or if you compounded it 100 times a range of 95.12%-105.13% of the actual figure. That is far better than the acceptable amount of error in the methodology.
4:15 Hey mate, just to let you know it's not the measurement techniques. The difference between IMF and World Bank is because they are two different years (EDIT: it's actually three). The IMF figure you are reporting is the 2022 year, World Bank is 2021. There are global standards involved in measuring GDP, aka the 2008 SNA and they are the same for both that's because they are not doing the measuring, they are using the data collected by the statistical agency for that country. In Australia's case that's the Australian Bureau of Statistics. Differences are more likely due to the conversion to USD (using end of period, or average conversion rate, or whatever) and/or the conversion from financial year to calendar years, rather than anything measurement related. The calendar year conversion is important, because Australian annual GDP is reported on financial year basis, aka July-June.
To jump on this, the IMF 2021 GDP for Australia is 1,640,000,000,000 (USD) vs world bank 1,542,660,000,000 (USD). The United Nations only has data for 2020 which as of today (because currency conversion) was 1,357,719,625,710 in current US dollars
Yep good pick up and what's important is that's not really comparing apples with apples, as 2021 figures published in 2022 will include revisions to include latest data (the whole time series will be revised). If you Wayback machined it it may be even closer.
Finally someone points that out. If we want to be serious in using data, we need to understand how they are generated. Economics suffers from people that have fancy discourse but don’t really understand.
Respect to EE for shouting out M&M, given Joeris criticisms of EE. Big dog stuff. Both channels are top tier and share content that has helped me learn a lot. One of the few channels in the space I recommend to my readers and viewers
Great channels. EE is more basics of economics and Money and Macros tends to go into more complex or deeper discussions. They compliment each other well in that I can use EE to learn the basics such as how some economic data is measured and have that measure explained to me in layman’s terms. Then with M&M I can learn more in depth about some single news topic.
@@ArawnOfAnnwn no he’s not. Given how long before these videos are planned, it’s likely EE started this before M&M released their video. And they discuss different things. M&M is almost entirely discussing the light study while EE only spends a small portion of the video on it and is mostly discussed the economics 101 of how data is collected and issues that might arise as well as other indicators that might be used as well to help verify the government data.
I mean number can be made up but if you live in China, you can see the life change so fast, my parent started out studying under no electricity now travel the world in a whimp. 2 decades ago, people with car consider rich now they just a normal thing.
Nobody who calls themself a scientist would use a single data point to draw their conclusion. The light level data is just one point. It's highly dependent on a lot of factors, cultural, political and economic. You must have other data points to tease out the contributions of each factor. For example, a culture which values privacy and builds high-rise residential buildings would be dark, because illumination would be hidden behind curtains. You'll only observe the exterior lights, which won't light up the entire building, just the gardens and walkways on the ground level. So a 6 story building any brighter than a 3 story one, even if it houses twice as many people. Someone who cares about the real numbers (rather than writing an attention-grabbing headline) will confirm their findings by looking at the amount of power produced or transmitted. If you don't have official numbers, then look at the number and types of power plants, power lines, and transformers. Going a step further, you can check *those* numbers by looking at oil, coal and gas extracted or imported for thermal plants, and weather data for hydroelectricity. So on and so forth. It's easy for China to fake one set of numbers. Much harder for them to fake all of the numbers in a way that still made sense. This is how audits are done. They don't have a time machine to go back and check what actually happened, they just check if *all* of the numbers match up.
@@Bdickey what I mean is (more precisely :)) perhaps it is reasonable to interpret a string of zeros which terminate the figure as indicative of deliberate rounding due to lack of precision/accuracy/completeness or honesty
@@Sheblah1 I get your point however if we consider the inverse, let’s say they had every digit down to the cent represented, I don’t think that’s an indication they’re Indeed more accurate results. If anything just seems like they’re naive to think they could even be capable of results that accurate. It’s just an understood margin of error and when the scale is so large it’s just arbitrary to try to track amount that are less than 1% of the total,
Would be cool to see you rank Czech Republic, some things are awesome, but other things are so bad that they completely negate the good. I think the score would be way below 5, as the growth would get probably 1 point. We just reached the point of being developed economy, but started stagnating immediately after. Its also due to lack of workers, as companies refuse to expand, because getting additional workers is close to impossible. Luckily lot of Ukrainian refugees came here and hopefully a lot of them will stay. Its so bad that on some possitions,you have to keep a person who doesn't work properly and even annoys coworkers as there is noone to replace that person
Funnily enough Russia wants those Ukrainian refugees to stay as well. Outside of Ukraine that is. Ukraine was already facing a population crisis even before the war, so the less capable its economy is the more of a liability it would be for its new friends.
A licensed accountant working for one of the big real estate developer once told us , even if he spend no money at all , he cannot afford one of the condos the company is selling. The condo is 2 mil HKD , roughly 263k USD , so you can imagine the real situation there. And he is already considered a "middle-class" there. And that was 2018.
The light pollution method of measuring GDP was meaningful 20y ago, but now is way out of whack. For example I live in Bulgaria, in the EU. On a recent night photo of Eastern Europe from space showing how dark Ukraine is (due to Russian terrorism) compared to countries around it, I noticed Bulgaria is also relatively darker compared to say Serbia. Except Bulgaria has higher GDP then Serbia so why would it be darker. Well electricity is way more expensive in Bulgaria then in Serbia and also Bulgaria has had access to EU infrastructure funds, so the vast majority of the lighting infrastructure in Bulgaria has been upgraded in the past 20y to be directed down(where it matters) and be energy efficient(LED lamps etc.). There is this situation that the poorest country in the EU may have one of the most efficient night lighting networks in the EU, precisely because the incentive was higher to update those resources so they won't cost much. I would imagine that different regions of China would have vastly different lighting development level too.
Well, I think since the reform of China, energy is the bottleneck, therefore most of their street lamp are in fact directed down with a very strict standard on its dispersal and energy efficiency, in addition to restricting the brightness. (Needless to say, LED were used)
During my career in manufacturing I learned that it is unwise to use the same statistics (eg freight car loadings) to measure a condition or trend and also to measure an individual''s or group of individuals' job performance.
Let’s play EE Bingo! ✅ ‘So what is going on here?’ ✅ ‘You know what?’ ✅ ‘With that out of the way’ ✅ ‘Well, yea/no/maybe/maybe not/yea nah/nah yea/what is there to say?’ ✅ ‘Stability and confidence’ ✅ ‘Money printer go brrr’ ✅ ‘We have covered the topic of X before’ ✅ ‘Hmmm’ ✅ ‘BUT!’ ✅ ‘Nobody can predict the future, least of all economists’
Have been waiting for that for ages also. Starting to get really tired of all these rankings putting thing past germany or france, whilst the eu is an economic bloc
Li KeQiang also said the poorest 600 million Chinese live on 1000RMB a month and an addition 300 million live on 2000. That’s over $2 trillion USD in living expenses for the poorest 64% of the population. If the $9 trillion figure holds water then China is a lot more equal than the Gini coefficient would suggest
Could you make an analysis of Poland's Economy? I remember that a few months ago it had the 2nd highest inflation in Europe (behind hungary), and I wonder how the country is doing now. And also i am curious where would Poland rank on your National economy leaderboard
Inflation is simple. Look at how much money your wage increased. When it increases we gain money. This is inflation. Over time as people gain increased wages the inflation increase which means we get money to import goods. When we import they're able to print more money. Countries with exporting industries export inflation. You just work to get money to buy their goods. That's why production is a macro economy and why one country do not have a certain inflation. They just made money to make them spend more money. The more inflation = oversupply of goods.
Regarding the section about light emission correlating with economic output: that’s actually not what the paper says. The idea is that GROWTH of light output over time is highly correlated with economic growth, and thus you can use it to determine whether someone is cooking the books regarding their economy. There is not much room for discretion on this one, as it just compares historical nighttime maps to make approximate guesses about the amount of growth a country has experienced.
Fair to say that every government lies about its economic success to some degree - but when there's no opposition or critical media: those lies can go uncorrected and unchallenged.
@@FrozenBusChannel i mean if the new calc are to be believed, then china GDP per capita would be lower than India in PPP terms and anyone that's visited both nations knows that's just absurd, the diff is b/w 1st and 3rd world. even the rural areas of china have a better infrastructure,power, standard of living, and cleanliness than metro Mumbai which is India's powerhouse
You have to travel to China and see their buildings, hydro dams, subways, shopping malls, roads and airports. See how much it costs to buy food and fuel for your car. Seeing is believing.
This is the opposite of what happens in African economies. African countries have problems with getting accurate economic measurements. I remember Nigeria’s GDP almost doubled in 2014 because the government didn’t keep up with the economic data for years. Ghana had a 50 percent jump in GDP, Tanzania, Kenya also had high increase in their gdp rebasing. African government don’t like to acknowledge their economic growth so they can get more financial assistance from foreign countries.
12:00, in some countries like Estonia, there are stuff like ligth standards, that are there to cut down on ligth pollution. Cities are criticised when they are too bright, or when they for exemple have too many street lamps on when they are not needed. You can see it sometimes in Estonia when walking on an bigger streets how one moment every 3rd streetlamp is on, and then when it gets darker, it changes to every 2nd streetlight. This though can depend on the city, I see this a lot more often in souther Estonia than in Tallinn, the capital that doesn’t follow the ligth pollution standards that carefully as some other places.
I wish that we had that. We have a large amount of poorly designed lamps that create what I like to call "stray light." It's streetlights that shine directly in your eyes, meanwhile the road is still poorly illuminated. Or porch lights and building entrance lights without shades, that cast light in every direction. Lighting design is important, because proper lighting means that you need less of it, and that saves money AND energy. Good night vision (in your eyes) can't develop if you're always looking directly into lights. Unshaded lights, poorly-designed streetlights, and modern cars with undimmable screens as dashboards all contribute to what Car and Driver once called "Dazzle Dunces." We can't see well, so we just add even more light!
@@sor3999 less ligth doesn’t directly mean more crime. Crime is an outcome of many different factors. I bet that when people think about streetlamps in Estonia, crime is one of the last things they will come up with, as Estonia has one of the worlds lowest crime rates (top5 or something). Reducing the ligth pollution doesn’t directly leade to more crime, but reducing the standards of living for people, making them feel like an lower class, by for exemple increasing the ligth pollution around the area where they live, has an bigger likelihood of increasing crime than the first option.
Regardless of the GDP figure, the most important part for people is : 1. living standard improvement; 2. diversity of goods or services; 3. food security 4. access to school/education level 5. medical care 6. safety concerns 7. sustainable progress
Great video that provides important insights on the background to this question. The two sources used are well researched, however I do believe they only show one side of the story. China’s GDP is extremely complex, and you can find just as much research papers supporting that it is actually bigger than official figures. A 200 page research paper published from the Center for Strategic and International Studies concluded that there are key areas within the calculation of GDP that China does not align with international standards (specifically inputted rent) which results in total GDP to actually be ~12% understated. This paper also makes reference to your first paper from Holz. Source: CSIS, Broken Abacus (AUTHORS Daniel H. Rosen, Beibei Bao; FOREWORD Carsten Holz) Another example is by the National Bureau of Economic Research published in 2017 which uses the same method (Night time lights) as the second paper you referenced, and concluded that China’s GDP is also understated. Source: NBER paper w23323 (Hunter Clark, Maxim Pinkovskiy & Xavier Sala-i-Martin) There are plenty of other well researched papers that support this, and all this is not even getting into the topic of PPP (which the CIA notes is the better measurement of China’s economy), and puts China well ahead in GDP rankings (and is already the largest economy in the world) Source: Any CIA factbook website footnote on China PPP vs GDP Overall I think this video is well researched, but the topic is much more complex. There’s an ocean of research on this topic that argue both sides with plenty to dispute the assertion that China is inflating GDP figures, so the conclusion made that China’s GDP is only $9 Trillion is an extremely unlikely. Great video overall.
@@michaelgray1223 they are 1.4 billion people and same electricity consumption per capita as Germany and Denmark. They consume more electricity then EU, US and India combined. they might be same as the US or a little lower but far from under half the size of US economy. They also buy about 60% of electric cars in the world.
Hundreds of world class and renowned academics, economists analysts, banks, investment funds and other institutions spend their careers continuously combing through China statistics with a fine comb. Far more than most countries. The figures are well within any tolerance.
I love your videos! They are super informative and so well explained. Have you considered making a video about the 4-day work week, why we don't have it yet, and how it could be achieved? I cannot understand how all the technological advances over the last ~50 years have not resulted in a reduction of work hours and find it interesting that this topic does not get more attention.
Because your boss needs a space hotel or a bigger yacht. How about the passive income people want to avoid work. Its simple math; My rent was raised (by my passive income landlord avoiding working) this month so now I need to work more hours. The 1% work less ~ the 99% work more.
Actually, the rich province in China will say the GDP number smaller than is actually to be，Because smaller number can decreased Tax，And the poor province in China will enlarge the number.
At th 5:00 mark the use of Precise and Accurate gets lost. The World Bank etc. CAN be precise down the nearest million - in fact they have - but the number being this precise can give users of this information (not "data") the wrong impression of *accuracy*
Includes Chinese wartime statistics, something most people will not admit. How do you kill 300,000 in a city thats proven to have a population of 200,000 in 1937?
12:00 I appriciate that you bring the method of using nightlight data for measuring the economy into this video. Despite several flaws, using nightlight data can still be useful in the region with limited amount of data needed for the research. My bachelor's thesis supervisor is actually using this in measuring economic impacts of ports in Indonesia and also in measuring the impact of highway on suburbanization (both are already published into the journal).
I love that you point out that other countries also “adjust” their numbers, similarly to China, they just don’t get the same spotlight. As a non-Chinese person, I always see a strong bias against China in any realm, despite equally egregious actions by other countries. I appreciate your attempt to shed light on this topic in an attempt to remain as neutral and objective as possible.
This is the opposite of what happens in African economies. African countries have problems with getting accurate economic measurements. I remember Nigeria’s GDP almost doubled in 2014 because the government didn’t keep up with the economic data for years. Ghana had a 50 percent jump in GDP, Tanzania, Kenya also had high increase in their gdp rebasing. African government don’t like to acknowledge their economic growth so they can get more financial assistance from foreign countries.
@@Rallosz Other countries have reporting inaccuracies but western nations have nothing on the level of China because fraud is incentivized by China's quota system which isn't a feature of other nations...well, there's also Russia... Here's an example. Fisherman A catches x-kilos of fish last week. He reports but passes off catch to fisherman B who reports those numbers as well, plus maybe a bit he caught. Now the records think there's 2x+y kilos of fish produced, when in reality is just x+y fish. Next month fisherman A hurt his back and missed a few days of work. So fisherman B returns the favor by bumping up his numbers. This is systemic in China, and leads to gross overestimations of productivity. It happens in fisheries. I've 2nd hand reports of it happening in their lumber/forestry sector westerners who have wood products businesses in China.
At simply wall street, a LOT of Chinese companies have too-good-to-be-true balance sheets and future prospects. One lesson I learned: if something looks too good to be true, it is.
The highway traffic junction at 1:29 is not China, it is the Wat Salud interchange in Thailand, south east of Bangkok. Not really relevant to the story perhaps, but although I really live this channel, I regret it never actually shows actually interesting footage. It is basically a podcast that is more expensive to make but perhaps with a bigger audience than when just published on i tunes. [Edit] and then in the very last minute he plugs his new Spotify channel lol. I didn't know that, but given what I wrote above that makes perfect sense 😄
Whatever Chinese economy is it's great....we outsiders can't live without their exported items ...so even if it's inflated it's going great.... maybe at most it can be argued that normal Chinese citizens are actually worse than they said to be ...but as a whole full Chinese economy is in decent shape because of their export and capacity to produce goods at good quality with lowest price to serve the people
Another great, informative and easy to understand video! Not to mention the best one I've seen yet explaining China's GDP, using level headed tone and without bias or inflammatory language found in most content about China.
At 12:47 You state that the figures are generally unreliable but also overstated. Where's your evidence that they're overstated rather than understated? It seems to me the Communist party has all kinds of reasons to understate their progress. Moreover isn't it the case that the US government has argued that they are in fact understating their progress has a developing economy for the purposes of gaining leeway in manipulating the currency, at least in the past. Edit. I was concerned retracting my complaint or concern but rather have decided to request nothing less than a 2 and a 1/2 to 3 hour video analyzing this in much much much greater detail. Given the near inevitability of global conflict not excluding World War 3, I think it is well worth the listening time if not the production time.
Just wondering why we have been criticized china‘s lie on economic Statistics for so long, and China is still standing up and not collapsing, and see like some countries we’d been praised but their economy finally collapsed, anyone tell me why?
Economic dishonesty can be perpetuated when there are a lack of consequences, a glut of foreign cash flowing in, and enough slave labor to keep things moving.
Due to heavy state interference they've done their best to damage control and keep their economy from collapsing but if nothing changes they're on their way to a collapse. It's just happening slower.
China has enough size to keep lying for a long time. Their industrial capabilities is no joke as proved by real goods they produced. BUT, do their economic number actually reflect reality or just like how other communist state that fudge number from down to the top
lol according to 1000 videos on youtube China collapsed in 30 days, 6 months ago. I'm sure all those videos have nothing to do with USA's 500 million dollar bill to smear anti-China "propaganda".
@@timtam53191 ok anti-China has been American goal for so long, I guess since the end of Soviet union, but 911 and American's wars in ME, held back Anti-China movement to later on til Trump's appearance.
Awesome video! Do you think you will respond to Money in Macro's video about China's GDP being up to 50% lower? Edit: Welp... I feel like a clown. Didn't realize you mentioned it later in the video lol
¿Valdrá la pena hacerlo? Ese estudio es muy ambiguo y se puede desmontar con muchos contra-argumentos... Al final no cambia el hecho tangible que representa la poderosa economía China(de lejos más importante que la Japonesa y Alemana)
@@Wilian_VillanuevaThe study apparently accounted for a lot of potential variables. Not saying that all variables were accounted for or that all of them were accounted correctly, but even if we’re giving a lot of leeway to china it’s gdp is still probably like 40-30% lower than reported. That makes all the problems it’s facing worse and it weakens it’s stance against the US
9:39 If the growth rate is always over-estimated by, say, 1% for 25 years. Take, for example, 6% and 7%. After 25 years, 1.07^25=5.4274, 1.06^25=4.2919. You think people can not tell the difference? There cannot be so many fools.
Really great video, as always. I would like to se a collaboration between EE and M&M, i think that could be fun or maybe just EE making a vist on the M&M talks. And one more thing I hope you see this EE. I would like to see Denmark (I'm Danish) on the country leader board list. You have talked about all the other nordic contries (Island, Sweden and Norway), I know we a not Norway (But it's our oile "national joke"). Anyway keep the good work, I really enjoy your video's :D
My dad grew up in a house with no electricity just out of the city with the largest port in NZ, Tauranga. His mother grew up in the north where they built the first road when she was a teenager to connect Rangi Point with civilisation. My nan’s land was settled in September 1054AD by the priest and navigator Nukutawhiti the greatgreatgreat grandson of Kupe who chased Muturangi’s octopus to Aotearoa from Hawaiki, which i believe is the island of Raiatea in the Tuamotu archipelago. My nan by her mother is a descendant of Nukutawhiti, and her father was from Australia and he was a fisherman
Regarding precision: Its amusing that Olympic gymnastics are scored to a thousandths (.000) of a point, yet Olympic running events are only measured to a hundredth (.00) of a second. Apparently personal opinion can be measured with more precision than something as finicky as time. 😂
You're using points vs seconds. Completely different things. Getting times that are the same to a hundredth of a second is highly improbable and would likely not make a difference. But getting averages that would be close to a thousandth is possible and easy to measure.
Okay, now I'm interested in using machine learning to estimate the GDP. Sure lighting alone isn't enough, but if we use many different predictive features, some interesting patterns might emerge...
it would need to come up with the unique bias of the country, such as those explained in this video. Since China is, well China, you would need training data from it to estimate its own biases. And since China’s data is the one in doubt, I don’t see how that would happen.
I'm not sure it would help. Machine learning needs a large set of data and some kind of baseline to train against. The issue is there isn't a large set of data (there are only so many countries) and there isn't a baseline (that's exactly what we're trying to determine). There's also the underlying issue that different data sets have different degrees of reliability depending on the country in question.
@@marcob1729 I think the idea is that one would train to predict only from the secondary measures, not from stated figures. Then you can train it on places with more reliable stated GDP figures to correlate the secondary ones to the GDP.
Love your channel bro! Would love if you could keep making comparative videos for current state of future economic projections as things change over time. I think the biggest thing id like from your channel is being able to assess future market growth projections. If you did this annually that would be great.
Thanks very much for your very interesting videos. I guess your podcast-versions are only available to subscribers of Spotify? By the way, I often look to see if your channel has appeared on Nebula, but nothing so far... isn't Nebula a great platform for your content?
Great video. Money and Macro did a good in depth video covering different aspects of the same thing. They spent more time analyzing the light usage to gdp data and found that it was good use of data even if it’s not entirely accurate. But even the original paper said that his light data showing 60% lower gdp in China doesn’t mean the 60% is entirely accurate. It just gives you an idea of how exaggerated the gdp data likely is. I’ve traveled China a few times and noticed that city cores of major cities look rich or middle class but outer parts of the city are as poor as typical Mexico (also traveled it) and rural areas are African level poor. Rural in the context of China can mean a town of 300,000!
@@paullnetinstitute4799 the very fact guy can’t see the importance lead me to believe your a a die hard defender of the CCP. It doesn’t take much thought to understand the importance of grossly exaggerated gdp figures, especially when China uses that keep control of the people.
Maybe check Mexico's number first before saying China inflated GDP and Chinese suburbia is as poor as Mexican suburbia. No kidding, China and Mexico have nearly the same GDP per capita on nominal and PPP basis. They should look similar and further proof there is no inflated GDP Jokes like you are why I am not concerned about anti-china movements in the West. You cannot even take care of yourself in your own country and needs the smarter half to take care of you
5:20 I find it extremely hard to believe they don't present this with error margins. So hard to believe I find a lack of reassurance that they actually don't come with error margins highly suspicious.
Provide the public with accurate, un-manipulated statistics that reveal just how poorly politicians are doing? A politician would never allow that to happen!
13:00 Paris Population is 2,102,650 (GDP US$984 billion, 33% of the economy of France GDPPc was 73,000)，shanghai Population is 26,875,500( GDP $679 billion, 4% of the economy of china ,GDPPC was 27,000) Does Paris Lie About Its Economic Statistics?
Yeah, totally. American companies sure received fake dollars from the fake production and labor exploitation in China for more than 3 decades now. It's a scam.
Remember in the late 1800s the next war was predicted to be between the US and European powers due to its copyright infringements of many European technologies especially German and British. So no your argument applies to everything that was learned. Everyone copies better things so they can improve. You do it, I do it, everyone does it.
Only 2% of people in China pays tax? Not sure where do you get the data from? Almost 90% of the employee pays income tax. Just government agencies alone account for more than 10% of the work force in China. They all pay taxes. Tax fraud is a serious crime in China. Only some small business and self employed may not pay tax. But most people have normal jobs pays taxes as that’s linked to the social security and retirement pension fund payment.
Their bias opinion really makes them blind. I don't think they even care about the data accuracy, maybe there's no data to backup at all. People like to watch this kind of video that says China is not doing very well. Just another video to gain views and likes.
17:30 For GDP per capita, you should also adjust for the lower population that China has been found to have. The re-worked GDP PC figure would still be much lower than $10.4k, but higher than $4.5k.
I used to work In a bubble tea shop for part time jobs when I was in high school in China. I lived in a town under a small county, the poorest county in our region and our region is the fourth richest region in our province, which has 9 regions overall. so basically we are not rich. But I earned $2.5 an hour, in summer I earned $400ish in a month, as I worked 8 hours per day, 5 days per week. Making bubble tea is one of the job with lowest income as it doesn’t need skill and it’s not very hard, an average worker in construction should be able to earn $800-1000 per month, with a month of awards in new year so it would be around $10400 a year. Most of office workers in small cities should earn around $600 a month, if you are in Shanghai it should be at least $1200 or even $1400. That’s why I think your statements are wrong. There’s no way Chinese GDP per capita is under $6000. In a developing country you should get lower proportion of income compare to your GDP per capita as more money is reinvested and the labourers are not protected that well. Today most Chinese have income at least $6000 a year and that is considered to be very low number, as the minimum wage is $300 a month and $3600 a year. Most ppl believe this minimum wage standard is meaningless and is not protecting workers rights at all as it is way lower than most ppls income
Gotta say, that high ranking for New Zealand is looking increasingly silly. I get that social-democratic minded economists like the current NZ economy-government, but come on, New Zealand is not an economic high-flier in any way. It has a high cost of living, with many young New Zealanders leaving for Australia and elsewhere.
Genius, firstly, disposable income is usually less than the capital per GDP. And now u are talking about China’s GDP per capital is less than 4500 dollars. That’s roughly 30,000 RMB. I find it hard to believe even based on my own 32 years experience.
its more specific to China because Japan, USA, Ireland, UK are all democracies, which means their data is essentially public and openly countable. China is closed off so it can basically report its own
A bit confused about GDP per capita. 16:35 GDP is 9 trillion. Population per google is 1.4 billion. Should the number at 17:30 be 6,400 instead of 4,500?
Those low figure does not make any sense whatever the perspective you look at. If China has a GDP per capita of 4.5k and India has a 2.27k. China, in every metrics are more than double of India. You can look at hard data like export, import and energy consumption or you can look from the on the ground experience in the cities and villages, China is many magnitudes better. If anything, its likely that China vastly under count their GDP compared to many other economies.
No offense but I'm a Master of Finance and Physicist and I have a question - How much do YOU lie about YOUR economic prowess? Your presentation on Ben Bernanke the other day wasn't even high-school level it was an utter disgrace. Do you even have a degree in economics?
There are alot more to a society than GDP per capita would suggested. Australia, Canada, New Zealand and lots of northern European countries have a much lower GDP than the US. But wealth equality, social security and Crime rate statistics are so much better, which make it much wealthier society for the vest majority. I would say the same about China. Although China is still a relatively poor country per GDP by capita, on the street level, poorer population live a much more dignify, safer and harmonious lives compared to comparable communities of many other nations.
Why not use your original score and the adjusted score in the rankings going forward? At the end you mentioned you will keep Chinas original score going forward because many other countries also misreport economic data. But among the countries you have near the top, China is alone on how much they manipulate it. And considering their manipulation is estimated to be as much as over 2x the actual gdp data, it would make sense to keep both scores going forward.
They went from 8.2 to 7.4, a large enough jump out of 10, but not double. As EE mentions toward the end, their growth is still good, and the manufacturing and service sectors are still strong. The overall score doesn't fall as significantly as it might appear.
@@Lawrence330 they drop several positions which is important. 8.2 to 7.4 is a big decline when you consider 0.8 in these comparisons is several positions and will grow in number of positions in between as he does more countries
@@Lawrence330 the poster you are replying to is likely an astorturfer - he engages in large threads with anti-china comments under any video even remotely related to china, he posts the same arguments over and over again and rejects or pretends he doesnt see any evidence that goes against his narrative. He is a bot do not engage with him. He has been caught in the act under multiple videos doing this and in a thread under another video he was exposed as posting from Eglin Airforce Base
As someone who has taught chemistry for the past 5+ years, thank you for going over precision vs. accuracy, and significant figures! Nice to see it being used outside of the traditional sciences.
Edit: precession to precision
“Precision”, to be precise.
I was thinking the same exact thing, I love it 😂
The one thing that I learned in Chemistry I still use is precision.
Thanks StevK - much appreciated!
@@jameswalker366 *slaps knee so violently that it dislocates the patella and causes damage that will take years to recover*
Hey EE thanks for the shout-out, which you really didn't have to do since I do not have a monopoly on topics :)
Wen Collab? xD
One caution with the "GDP per capita" numbers is that China is basically multiple countries in one. If you look at the coastal provinces (Beijing, Shanghai, Jiangsu, Fujian, Tianjin, Zhejiang, Guangdong), they have a GDP per capita similar to other advanced economies, especially if you adjust for PPP. Whereas the internal provinces have GDP per capita that hover around the poverty line.
You'd think that would be common sense since it works the same way in most countries, like Australia and the US for example. Economic activity is focused around major cities on coastlines and always has been, with numbers generally ramping down as you go inland.
@@Luke-xv7xo BIG difference between the US urban/rural divide and the Chinese urban/rural divide, literally two separate worlds in the latter case. Rural areas are basically stuck back 50 or 60 years behind doing subsistence agriculture.
@@icouldntthinkofaname379you're just saying the same thing as OP lol, like yeah there's a clear distinction but it still works the same way. cities = money, rural = a lot less money, it's universal.
@@Luke-xv7xo it is even worse in China because of their internal passport system
@@iamsheep Nope, for example France has Paris as its wealthiest region, and Germany has the Ruhr area as its economic motor.
5:22 For the love of god, please don't round it until you get to the final answer. If you're rounding at every step then you will potentially have huge errors.
well every gdp in every country always fake statistics always lie
Fermi problems/approximations are good for setting upper and lower bounds, usually within an order of magnitude when full data sets are not available to answer a question.
a classic example is _"how many piano tuners are there in chicago."_
Or _"how many cups of water are there in a bath tub?"_
Physicists and engineers often use them to make quick approximations, but are under no delusions they are to be used for real calculations when those are required.
Not what you are referring, but still something I recommend familiarizing if you are not already.
I think that one thing this video makes clear is that economists - even large, important organizations of them - aren't necessarily good statisticians. :)
You can round off like that when - with the data itself - it is not possible to be so precise, which makes it more inaccurate to not round it off. Also, he is not talking about every step, probably just the answer.
But for the most part you're right ofcourse!
No you actually should. Rounding to the millions place when you are talking about trillions is just a bad move. Rounding to the billions place means that the real number is within a half billion more or less, The error is at most .05% or if you compounded it 100 times a range of 95.12%-105.13% of the actual figure. That is far better than the acceptable amount of error in the methodology.
4:15 Hey mate, just to let you know it's not the measurement techniques. The difference between IMF and World Bank is because they are two different years (EDIT: it's actually three). The IMF figure you are reporting is the 2022 year, World Bank is 2021. There are global standards involved in measuring GDP, aka the 2008 SNA and they are the same for both that's because they are not doing the measuring, they are using the data collected by the statistical agency for that country. In Australia's case that's the Australian Bureau of Statistics. Differences are more likely due to the conversion to USD (using end of period, or average conversion rate, or whatever) and/or the conversion from financial year to calendar years, rather than anything measurement related. The calendar year conversion is important, because Australian annual GDP is reported on financial year basis, aka July-June.
To jump on this, the IMF 2021 GDP for Australia is 1,640,000,000,000 (USD) vs world bank 1,542,660,000,000 (USD).
The United Nations only has data for 2020 which as of today (because currency conversion) was 1,357,719,625,710 in current US dollars
Yep good pick up and what's important is that's not really comparing apples with apples, as 2021 figures published in 2022 will include revisions to include latest data (the whole time series will be revised). If you Wayback machined it it may be even closer.
Oh and of course the reference year for current price is different
Difficult to accept defeat
From west Africa
🦅
Finally someone points that out. If we want to be serious in using data, we need to understand how they are generated. Economics suffers from people that have fancy discourse but don’t really understand.
Respect to EE for shouting out M&M, given Joeris criticisms of EE. Big dog stuff. Both channels are top tier and share content that has helped me learn a lot. One of the few channels in the space I recommend to my readers and viewers
Great channels. EE is more basics of economics and Money and Macros tends to go into more complex or deeper discussions. They compliment each other well in that I can use EE to learn the basics such as how some economic data is measured and have that measure explained to me in layman’s terms. Then with M&M I can learn more in depth about some single news topic.
Saw m&m's vid when it first dropped and was really happy to see it get the shout out.
One of the reasons this channel is top 3 for me.
Whoa m and m? Meat heads and muscles?feature
@@ArawnOfAnnwn He is adding content though
@@ArawnOfAnnwn no he’s not. Given how long before these videos are planned, it’s likely EE started this before M&M released their video. And they discuss different things. M&M is almost entirely discussing the light study while EE only spends a small portion of the video on it and is mostly discussed the economics 101 of how data is collected and issues that might arise as well as other indicators that might be used as well to help verify the government data.
I mean number can be made up but if you live in China, you can see the life change so fast, my parent started out studying under no electricity now travel the world in a whimp. 2 decades ago, people with car consider rich now they just a normal thing.
It's been a remarkable transformation.
Apparently China have poured more concrete in the 21st Century than everyone else in the 20th Century.
Even after correction as suggested, china still did pretty well....so concur on your observation
I mean anyone who has been to China a few times know they went from bicycles to highspeed trains to a freaking space station in just under 30 years.
Yes and many families own multiple homes.
@@Commievn yes, that multiple home issue is what’s causing a global real estate crisis right now.
A very informative video. Your production quality has only been heightened since I started following you, glad to see it!
Pls, make video on private colleges vs public college. The economical advantage, and disadvantage of such systems.
Nobody who calls themself a scientist would use a single data point to draw their conclusion. The light level data is just one point. It's highly dependent on a lot of factors, cultural, political and economic. You must have other data points to tease out the contributions of each factor.
For example, a culture which values privacy and builds high-rise residential buildings would be dark, because illumination would be hidden behind curtains. You'll only observe the exterior lights, which won't light up the entire building, just the gardens and walkways on the ground level. So a 6 story building any brighter than a 3 story one, even if it houses twice as many people.
Someone who cares about the real numbers (rather than writing an attention-grabbing headline) will confirm their findings by looking at the amount of power produced or transmitted. If you don't have official numbers, then look at the number and types of power plants, power lines, and transformers. Going a step further, you can check *those* numbers by looking at oil, coal and gas extracted or imported for thermal plants, and weather data for hydroelectricity. So on and so forth.
It's easy for China to fake one set of numbers. Much harder for them to fake all of the numbers in a way that still made sense. This is how audits are done. They don't have a time machine to go back and check what actually happened, they just check if *all* of the numbers match up.
Perhaps when checking GDP we can reasonably treat trailing zeros as a measure of imprecision/inaccuracy/incompleteness of the figures.
each additional zero is less significant than the previous so not sure why that matters.
I commented on a comment guys!
@@Bdickey what I mean is (more precisely :)) perhaps it is reasonable to interpret a string of zeros which terminate the figure as indicative of deliberate rounding due to lack of precision/accuracy/completeness or honesty
@@Sheblah1 I get your point however if we consider the inverse, let’s say they had every digit down to the cent represented, I don’t think that’s an indication they’re Indeed more accurate results. If anything just seems like they’re naive to think they could even be capable of results that accurate. It’s just an understood margin of error and when the scale is so large it’s just arbitrary to try to track amount that are less than 1% of the total,
It's not even possible to calculate gdp beyond certain precision
Would be cool to see you rank Czech Republic, some things are awesome, but other things are so bad that they completely negate the good. I think the score would be way below 5, as the growth would get probably 1 point. We just reached the point of being developed economy, but started stagnating immediately after. Its also due to lack of workers, as companies refuse to expand, because getting additional workers is close to impossible. Luckily lot of Ukrainian refugees came here and hopefully a lot of them will stay. Its so bad that on some possitions,you have to keep a person who doesn't work properly and even annoys coworkers as there is noone to replace that person
Czechia is in a difficult position, too poor to complete with Germany, too rich to compete with Poland 😅 industry wise I mean
Czech Republic is in a bad shape for sure. you can see the real estate prices are too high compared to income levels with high inflation
Provly right where cansda is... Good country really sketchy gvnt pocketing money and keeping power with friends
Funnily enough Russia wants those Ukrainian refugees to stay as well. Outside of Ukraine that is. Ukraine was already facing a population crisis even before the war, so the less capable its economy is the more of a liability it would be for its new friends.
@@ArawnOfAnnwn Why don't you have enough population in your own!? Can't you breed and feed your children, by the way?
A licensed accountant working for one of the big real estate developer once told us , even if he spend no money at all , he cannot afford one of the condos the company is selling. The condo is 2 mil HKD , roughly 263k USD , so you can imagine the real situation there. And he is already considered a "middle-class" there. And that was 2018.
This is false news. It is true that many people can't afford to buy houses, but houses in Hong Kong are not as cheap as you say.😅
The light pollution method of measuring GDP was meaningful 20y ago, but now is way out of whack. For example I live in Bulgaria, in the EU. On a recent night photo of Eastern Europe from space showing how dark Ukraine is (due to Russian terrorism) compared to countries around it, I noticed Bulgaria is also relatively darker compared to say Serbia. Except Bulgaria has higher GDP then Serbia so why would it be darker. Well electricity is way more expensive in Bulgaria then in Serbia and also Bulgaria has had access to EU infrastructure funds, so the vast majority of the lighting infrastructure in Bulgaria has been upgraded in the past 20y to be directed down(where it matters) and be energy efficient(LED lamps etc.). There is this situation that the poorest country in the EU may have one of the most efficient night lighting networks in the EU, precisely because the incentive was higher to update those resources so they won't cost much.
I would imagine that different regions of China would have vastly different lighting development level too.
You also need to look at population density. China has high population density.
o you are a western shill as well who believe the west when it comes to ukraine. ofc you do.
@@metalvideos1961 well yeah for one because Kaputin lies a lot. Not sure why you'd trust people that lie to you, but I generally don't.
Well, I think since the reform of China, energy is the bottleneck, therefore most of their street lamp are in fact directed down with a very strict standard on its dispersal and energy efficiency, in addition to restricting the brightness. (Needless to say, LED were used)
During my career in manufacturing I learned that it is unwise to use the same statistics (eg freight car loadings) to measure a condition or trend and also to measure an individual''s or group of individuals' job performance.
Especially if you were caught shipping empty containers...
Let’s play EE Bingo!
✅ ‘So what is going on here?’
✅ ‘You know what?’
✅ ‘With that out of the way’
✅ ‘Well, yea/no/maybe/maybe not/yea nah/nah yea/what is there to say?’
✅ ‘Stability and confidence’
✅ ‘Money printer go brrr’
✅ ‘We have covered the topic of X before’
✅ ‘Hmmm’
✅ ‘BUT!’
✅ ‘Nobody can predict the future, least of all economists’
😑
💲💲💲
Great video!
It would be interesting to have a video on the whole EU economy and how you would rank it!
Have been waiting for that for ages also. Starting to get really tired of all these rankings putting thing past germany or france, whilst the eu is an economic bloc
Yeah, and America also. Everyone's on their bubble, it's just the matter of whom will pop first.
Overstatement of output was a major cause of the Great Leap Forward.
Great content as usual
This was a much needed video (at least for me). Thank you EE!
I understand why China was ranked so high now. You use the same data sets for everyone. This question had been on my mind. Good video.
7:18 Isn't it the correct formula, GDP = C+I+GI+(EX-IM) ?
C = Consumption
I = Investments
GI = Government Investments
EX = Exports
IM = Imports
Where can i find the complete Economics Explained Leaderboard till now?
Thank you from Sydney, always clear and educational. Much appreciated
Li KeQiang also said the poorest 600 million Chinese live on 1000RMB a month and an addition 300 million live on 2000. That’s over $2 trillion USD in living expenses for the poorest 64% of the population. If the $9 trillion figure holds water then China is a lot more equal than the Gini coefficient would suggest
One of my favorite channels I would really like to see this channel/ videos uploaded to rumble as well
Could you make an analysis of Poland's Economy? I remember that a few months ago it had the 2nd highest inflation in Europe (behind hungary), and I wonder how the country is doing now. And also i am curious where would Poland rank on your National economy leaderboard
Inflation is simple. Look at how much money your wage increased. When it increases we gain money. This is inflation.
Over time as people gain increased wages the inflation increase which means we get money to import goods. When we import they're able to print more money. Countries with exporting industries export inflation. You just work to get money to buy their goods. That's why production is a macro economy and why one country do not have a certain inflation. They just made money to make them spend more money. The more inflation = oversupply of goods.
Regarding the section about light emission correlating with economic output: that’s actually not what the paper says. The idea is that GROWTH of light output over time is highly correlated with economic growth, and thus you can use it to determine whether someone is cooking the books regarding their economy. There is not much room for discretion on this one, as it just compares historical nighttime maps to make approximate guesses about the amount of growth a country has experienced.
Fair to say that every government lies about its economic success to some degree - but when there's no opposition or critical media: those lies can go uncorrected and unchallenged.
That's why freedom of the press is important, and that's why there's next to none in China
@@FrozenBusChannel i mean if the new calc are to be believed, then china GDP per capita would be lower than India in PPP terms and anyone that's visited both nations knows that's just absurd, the diff is b/w 1st and 3rd world. even the rural areas of china have a better infrastructure,power, standard of living, and cleanliness than metro Mumbai which is India's powerhouse
You have to travel to China and see their buildings, hydro dams, subways, shopping malls, roads and airports. See how much it costs to buy food and fuel for your car. Seeing is believing.
This is the opposite of what happens in African economies. African countries have problems with getting accurate economic measurements. I remember Nigeria’s GDP almost doubled in 2014 because the government didn’t keep up with the economic data for years. Ghana had a 50 percent jump in GDP, Tanzania, Kenya also had high increase in their gdp rebasing. African government don’t like to acknowledge their economic growth so they can get more financial assistance from foreign countries.
Who told you there is no opposition or critical media?
12:00, in some countries like Estonia, there are stuff like ligth standards, that are there to cut down on ligth pollution. Cities are criticised when they are too bright, or when they for exemple have too many street lamps on when they are not needed. You can see it sometimes in Estonia when walking on an bigger streets how one moment every 3rd streetlamp is on, and then when it gets darker, it changes to every 2nd streetlight. This though can depend on the city, I see this a lot more often in souther Estonia than in Tallinn, the capital that doesn’t follow the ligth pollution standards that carefully as some other places.
I wish that we had that. We have a large amount of poorly designed lamps that create what I like to call "stray light." It's streetlights that shine directly in your eyes, meanwhile the road is still poorly illuminated. Or porch lights and building entrance lights without shades, that cast light in every direction.
Lighting design is important, because proper lighting means that you need less of it, and that saves money AND energy. Good night vision (in your eyes) can't develop if you're always looking directly into lights. Unshaded lights, poorly-designed streetlights, and modern cars with undimmable screens as dashboards all contribute to what Car and Driver once called "Dazzle Dunces." We can't see well, so we just add even more light!
"light pollution" huh yeah if you want a crime spree sure have it go dark at night or unless you live in a cushy suburb.
@@sor3999 less ligth doesn’t directly mean more crime. Crime is an outcome of many different factors. I bet that when people think about streetlamps in Estonia, crime is one of the last things they will come up with, as Estonia has one of the worlds lowest crime rates (top5 or something).
Reducing the ligth pollution doesn’t directly leade to more crime, but reducing the standards of living for people, making them feel like an lower class, by for exemple increasing the ligth pollution around the area where they live, has an bigger likelihood of increasing crime than the first option.
Regardless of the GDP figure, the most important part for people is : 1. living standard improvement; 2. diversity of goods or services; 3. food security 4. access to school/education level 5. medical care 6. safety concerns 7. sustainable progress
Great video that provides important insights on the background to this question. The two sources used are well researched, however I do believe they only show one side of the story. China’s GDP is extremely complex, and you can find just as much research papers supporting that it is actually bigger than official figures. A 200 page research paper published from the Center for Strategic and International Studies concluded that there are key areas within the calculation of GDP that China does not align with international standards (specifically inputted rent) which results in total GDP to actually be ~12% understated. This paper also makes reference to your first paper from Holz.
Source: CSIS, Broken Abacus (AUTHORS Daniel H. Rosen, Beibei Bao; FOREWORD Carsten Holz)
Another example is by the National Bureau of Economic Research published in 2017 which uses the same method (Night time lights) as the second paper you referenced, and concluded that China’s GDP is also understated.
Source: NBER paper w23323 (Hunter Clark, Maxim Pinkovskiy & Xavier Sala-i-Martin)
There are plenty of other well researched papers that support this, and all this is not even getting into the topic of PPP (which the CIA notes is the better measurement of China’s economy), and puts China well ahead in GDP rankings (and is already the largest economy in the world)
Source: Any CIA factbook website footnote on China PPP vs GDP
Overall I think this video is well researched, but the topic is much more complex. There’s an ocean of research on this topic that argue both sides with plenty to dispute the assertion that China is inflating GDP figures, so the conclusion made that China’s GDP is only $9 Trillion is an extremely unlikely. Great video overall.
The truth hurts right ?
9 Trillion sounds about right.
@@michaelgray1223 they are 1.4 billion people and same electricity consumption per capita as Germany and Denmark. They consume more electricity then EU, US and India combined. they might be same as the US or a little lower but far from under half the size of US economy. They also buy about 60% of electric cars in the world.
@@michaelgray1223中国的汽车销量比美国和日本和印度和德国加起来都要多，😢是的，真相确实很可怕。。。。
Please put your sources in the description of the video. That way it is easier for us to go back and look at them.
Hundreds of world class and renowned academics, economists analysts, banks, investment funds and other institutions spend their careers continuously combing through China statistics with a fine comb. Far more than most countries. The figures are well within any tolerance.
Thanks!
I love your videos! They are super informative and so well explained.
Have you considered making a video about the 4-day work week, why we don't have it yet, and how it could be achieved? I cannot understand how all the technological advances over the last ~50 years have not resulted in a reduction of work hours and find it interesting that this topic does not get more attention.
Because your boss needs a space hotel or a bigger yacht.
How about the passive income people want to avoid work.
Its simple math; My rent was raised (by my passive income landlord avoiding working) this month so now I need to work more hours.
The 1% work less ~ the 99% work more.
Short answer: Yes. It lies. Long answer: Continue watching video.
Actually, the rich province in China will say the GDP number smaller than is actually to be，Because smaller number can decreased Tax，And the poor province in China will enlarge the number.
At th 5:00 mark the use of Precise and Accurate gets lost. The World Bank etc. CAN be precise down the nearest million - in fact they have - but the number being this precise can give users of this information (not "data") the wrong impression of *accuracy*
I think at this point EA games are more trusted than Chinese statistics.
Ouch
Includes Chinese wartime statistics, something most people will not admit. How do you kill 300,000 in a city thats proven to have a population of 200,000 in 1937?
@@user-pn3im5sm7k There were 150,000 soldiers stationed there other than the native population, it's even confirmed by Japan's own data
12:00 I appriciate that you bring the method of using nightlight data for measuring the economy into this video. Despite several flaws, using nightlight data can still be useful in the region with limited amount of data needed for the research. My bachelor's thesis supervisor is actually using this in measuring economic impacts of ports in Indonesia and also in measuring the impact of highway on suburbanization (both are already published into the journal).
I love that you point out that other countries also “adjust” their numbers, similarly to China, they just don’t get the same spotlight. As a non-Chinese person, I always see a strong bias against China in any realm, despite equally egregious actions by other countries. I appreciate your attempt to shed light on this topic in an attempt to remain as neutral and objective as possible.
"as a non-chinese person(...)" Nice try, enjoy your extra social credit, M8 :D
@@cooperp6429 it's hard out here! I just wanted to earn a few more creds during our double social credit event 😢
This is the opposite of what happens in African economies. African countries have problems with getting accurate economic measurements. I remember Nigeria’s GDP almost doubled in 2014 because the government didn’t keep up with the economic data for years. Ghana had a 50 percent jump in GDP, Tanzania, Kenya also had high increase in their gdp rebasing. African government don’t like to acknowledge their economic growth so they can get more financial assistance from foreign countries.
@@Rallosz Other countries have reporting inaccuracies but western nations have nothing on the level of China because fraud is incentivized by China's quota system which isn't a feature of other nations...well, there's also Russia... Here's an example. Fisherman A catches x-kilos of fish last week. He reports but passes off catch to fisherman B who reports those numbers as well, plus maybe a bit he caught. Now the records think there's 2x+y kilos of fish produced, when in reality is just x+y fish. Next month fisherman A hurt his back and missed a few days of work. So fisherman B returns the favor by bumping up his numbers. This is systemic in China, and leads to gross overestimations of productivity. It happens in fisheries. I've 2nd hand reports of it happening in their lumber/forestry sector westerners who have wood products businesses in China.
@@cooperp6429 social credit very important indeed
At simply wall street, a LOT of Chinese companies have too-good-to-be-true balance sheets and future prospects. One lesson I learned: if something looks too good to be true, it is.
The highway traffic junction at 1:29 is not China, it is the Wat Salud interchange in Thailand, south east of Bangkok. Not really relevant to the story perhaps, but although I really live this channel, I regret it never actually shows actually interesting footage. It is basically a podcast that is more expensive to make but perhaps with a bigger audience than when just published on i tunes.
[Edit] and then in the very last minute he plugs his new Spotify channel lol. I didn't know that, but given what I wrote above that makes perfect sense 😄
Whatever Chinese economy is it's great....we outsiders can't live without their exported items ...so even if it's inflated it's going great.... maybe at most it can be argued that normal Chinese citizens are actually worse than they said to be ...but as a whole full Chinese economy is in decent shape because of their export and capacity to produce goods at good quality with lowest price to serve the people
Another great, informative and easy to understand video! Not to mention the best one I've seen yet explaining China's GDP, using level headed tone and without bias or inflammatory language found in most content about China.
This video is far from informative or accurate. It's a bunch of cheap propaganda that no real economist would believe lol.
I can only see bias in this video
@@kallashnykov all your comments are pro-communist anti-western brainwashed nonsense though
At 12:47 You state that the figures are generally unreliable but also overstated. Where's your evidence that they're overstated rather than understated? It seems to me the Communist party has all kinds of reasons to understate their progress. Moreover isn't it the case that the US government has argued that they are in fact understating their progress has a developing economy for the purposes of gaining leeway in manipulating the currency, at least in the past. Edit. I was concerned retracting my complaint or concern but rather have decided to request nothing less than a 2 and a 1/2 to 3 hour video analyzing this in much much much greater detail. Given the near inevitability of global conflict not excluding World War 3, I think it is well worth the listening time if not the production time.
Just wondering why we have been criticized china‘s lie on economic Statistics for so long, and China is still standing up and not collapsing, and see like some countries we’d been praised but their economy finally collapsed, anyone tell me why?
Economic dishonesty can be perpetuated when there are a lack of consequences, a glut of foreign cash flowing in, and enough slave labor to keep things moving.
Due to heavy state interference they've done their best to damage control and keep their economy from collapsing but if nothing changes they're on their way to a collapse. It's just happening slower.
China has enough size to keep lying for a long time.
Their industrial capabilities is no joke as proved by real goods they produced. BUT, do their economic number actually reflect reality or just like how other communist state that fudge number from down to the top
lol according to 1000 videos on youtube China collapsed in 30 days, 6 months ago. I'm sure all those videos have nothing to do with USA's 500 million dollar bill to smear anti-China "propaganda".
@@timtam53191 ok anti-China has been American goal for so long, I guess since the end of Soviet union, but 911 and American's wars in ME, held back Anti-China movement to later on til Trump's appearance.
Great content! Love your videos.
Awesome video! Do you think you will respond to Money in Macro's video about China's GDP being up to 50% lower?
Edit: Welp... I feel like a clown. Didn't realize you mentioned it later in the video lol
¿Valdrá la pena hacerlo?
Ese estudio es muy ambiguo y se puede desmontar con muchos contra-argumentos...
Al final no cambia el hecho tangible que representa la poderosa economía China(de lejos más importante que la Japonesa y Alemana)
@@Wilian_Villanueva
Something tells me you're South American.
@@Wilian_Villanueva jajaja bro por que respondes en español de repente
@@Wilian_VillanuevaThe study apparently accounted for a lot of potential variables. Not saying that all variables were accounted for or that all of them were accounted correctly, but even if we’re giving a lot of leeway to china it’s gdp is still probably like 40-30% lower than reported. That makes all the problems it’s facing worse and it weakens it’s stance against the US
The US don't think so. Otherwise they won't be so paranoid about China.
Economics explained - 100 social credit score
You make great content, but could please do a video on Estonia!
9:39 If the growth rate is always over-estimated by, say, 1% for 25 years. Take, for example, 6% and 7%. After 25 years, 1.07^25=5.4274, 1.06^25=4.2919. You think people can not tell the difference? There cannot be so many fools.
They always think everyone else are idiots lol.
-9999 social credits
great video, now i really really want one about germanys economy, with the ranking at the end of course :)
Really great video, as always. I would like to se a collaboration between EE and M&M, i think that could be fun or maybe just EE making a vist on the M&M talks. And one more thing I hope you see this EE. I would like to see Denmark (I'm Danish) on the country leader board list. You have talked about all the other nordic contries (Island, Sweden and Norway), I know we a not Norway (But it's our oile "national joke"). Anyway keep the good work, I really enjoy your video's :D
My dad grew up in a house with no electricity just out of the city with the largest port in NZ, Tauranga. His mother grew up in the north where they built the first road when she was a teenager to connect Rangi Point with civilisation. My nan’s land was settled in September 1054AD by the priest and navigator Nukutawhiti the greatgreatgreat grandson of Kupe who chased Muturangi’s octopus to Aotearoa from Hawaiki, which i believe is the island of Raiatea in the Tuamotu archipelago. My nan by her mother is a descendant of Nukutawhiti, and her father was from Australia and he was a fisherman
Thanks for being a grounded source of information
More than welcome!
Regarding precision: Its amusing that Olympic gymnastics are scored to a thousandths (.000) of a point, yet Olympic running events are only measured to a hundredth (.00) of a second. Apparently personal opinion can be measured with more precision than something as finicky as time. 😂
You're using points vs seconds. Completely different things. Getting times that are the same to a hundredth of a second is highly improbable and would likely not make a difference. But getting averages that would be close to a thousandth is possible and easy to measure.
Okay, now I'm interested in using machine learning to estimate the GDP. Sure lighting alone isn't enough, but if we use many different predictive features, some interesting patterns might emerge...
it would need to come up with the unique bias of the country, such as those explained in this video. Since China is, well China, you would need training data from it to estimate its own biases. And since China’s data is the one in doubt, I don’t see how that would happen.
I'm not sure it would help. Machine learning needs a large set of data and some kind of baseline to train against. The issue is there isn't a large set of data (there are only so many countries) and there isn't a baseline (that's exactly what we're trying to determine). There's also the underlying issue that different data sets have different degrees of reliability depending on the country in question.
Definitely would make things worse. It just creates some arbitrary parameters that you cannot really verify if they are accurate
Your ML algorithms will only be as good as the data used to produce them.
@@marcob1729 I think the idea is that one would train to predict only from the secondary measures, not from stated figures. Then you can train it on places with more reliable stated GDP figures to correlate the secondary ones to the GDP.
Love your channel bro! Would love if you could keep making comparative videos for current state of future economic projections as things change over time. I think the biggest thing id like from your channel is being able to assess future market growth projections. If you did this annually that would be great.
Thanks very much for your very interesting videos. I guess your podcast-versions are only available to subscribers of Spotify? By the way, I often look to see if your channel has appeared on Nebula, but nothing so far... isn't Nebula a great platform for your content?
this video was quite educative for me
great content as always
Great video. Money and Macro did a good in depth video covering different aspects of the same thing. They spent more time analyzing the light usage to gdp data and found that it was good use of data even if it’s not entirely accurate. But even the original paper said that his light data showing 60% lower gdp in China doesn’t mean the 60% is entirely accurate. It just gives you an idea of how exaggerated the gdp data likely is. I’ve traveled China a few times and noticed that city cores of major cities look rich or middle class but outer parts of the city are as poor as typical Mexico (also traveled it) and rural areas are African level poor. Rural in the context of China can mean a town of 300,000!
but i guess all this useless as long as every data estimate agrees that China is the second largest economy
@@paullnetinstitute4799 the very fact guy can’t see the importance lead me to believe your a a die hard defender of the CCP. It doesn’t take much thought to understand the importance of grossly exaggerated gdp figures, especially when China uses that keep control of the people.
@@paullnetinstitute4799 okay, it’s confirmed paullnet is a CCP tr°//. You sub to Barret which is a CCP paid western RUclipsr spreading CCP propa.
Maybe check Mexico's number first before saying China inflated GDP and Chinese suburbia is as poor as Mexican suburbia. No kidding, China and Mexico have nearly the same GDP per capita on nominal and PPP basis. They should look similar and further proof there is no inflated GDP
Jokes like you are why I am not concerned about anti-china movements in the West. You cannot even take care of yourself in your own country and needs the smarter half to take care of you
@@Homer-OJ-Simpson so world bank ad imf are paid by ccp becuase they use official state data. Find some job to keep your mind active
5:20
I find it extremely hard to believe they don't present this with error margins.
So hard to believe I find a lack of reassurance that they actually don't come with error margins highly suspicious.
Couldn't computers be the economist at the end of the line keeping track of everything
I guess the problem with that is with having reliable inputs, if they put in inaccurate data it will give out inaccurate results
Nope. If financial history has taught us anything, it's that we are really good at manipulating numbers and rules to tell the story we want.
No.economic calculation problem, or garbage in/garbage out problem, depending on what you mean by keeping track
Provide the public with accurate, un-manipulated statistics that reveal just how poorly politicians are doing? A politician would never allow that to happen!
13:00 Paris Population is 2,102,650 (GDP US$984 billion, 33% of the economy of France GDPPc was 73,000)，shanghai Population is 26,875,500( GDP $679 billion, 4% of the economy of china ,GDPPC was 27,000) Does Paris Lie About Its Economic Statistics?
It's not unfair to say that it's rise has come through lying, stealing and cheating.
Yeah, totally. American companies sure received fake dollars from the fake production and labor exploitation in China for more than 3 decades now. It's a scam.
that's how most economies turn into superpowers lol
Congrats, you just described how anyone came or will come to power.
you are describing literally most nation from europe to usa lol
Remember in the late 1800s the next war was predicted to be between the US and European powers due to its copyright infringements of many European technologies especially German and British.
So no your argument applies to everything that was learned. Everyone copies better things so they can improve. You do it, I do it, everyone does it.
"trickiced you into learning about analytics" well played, well played.
Only 2% of people in China pays tax? Not sure where do you get the data from?
Almost 90% of the employee pays income tax. Just government agencies alone account for more than 10% of the work force in China. They all pay taxes. Tax fraud is a serious crime in China. Only some small business and self employed may not pay tax. But most people have normal jobs pays taxes as that’s linked to the social security and retirement pension fund payment.
Their bias opinion really makes them blind. I don't think they even care about the data accuracy, maybe there's no data to backup at all. People like to watch this kind of video that says China is not doing very well. Just another video to gain views and likes.
China bad= More views and likes
Thanks for the video EE
17:30
For GDP per capita, you should also adjust for the lower population that China has been found to have.
The re-worked GDP PC figure would still be much lower than $10.4k, but higher than $4.5k.
This guy thinks that china is poorer than india and kenya. Delusional wishful thinking
probably about 6500 seems right,
@@alexyou3233 Well no? India is like 2000
Short answer: a lot 😂
I used to work In a bubble tea shop for part time jobs when I was in high school in China. I lived in a town under a small county, the poorest county in our region and our region is the fourth richest region in our province, which has 9 regions overall. so basically we are not rich. But I earned $2.5 an hour, in summer I earned $400ish in a month, as I worked 8 hours per day, 5 days per week. Making bubble tea is one of the job with lowest income as it doesn’t need skill and it’s not very hard, an average worker in construction should be able to earn $800-1000 per month, with a month of awards in new year so it would be around $10400 a year. Most of office workers in small cities should earn around $600 a month, if you are in Shanghai it should be at least $1200 or even $1400.
That’s why I think your statements are wrong. There’s no way Chinese GDP per capita is under $6000. In a developing country you should get lower proportion of income compare to your GDP per capita as more money is reinvested and the labourers are not protected that well. Today most Chinese have income at least $6000 a year and that is considered to be very low number, as the minimum wage is $300 a month and $3600 a year. Most ppl believe this minimum wage standard is meaningless and is not protecting workers rights at all as it is way lower than most ppls income
Isn’t it spelled manipulator? (thumbnail)
If the US estimates its GDP based on taxes paid, their GDP is probably understated, what with all the tax dodging going on.
Gotta say, that high ranking for New Zealand is looking increasingly silly.
I get that social-democratic minded economists like the current NZ economy-government, but come on, New Zealand is not an economic high-flier in any way. It has a high cost of living, with many young New Zealanders leaving for Australia and elsewhere.
But even Australia is not doing that well. The mining industry is literally tanking their entire economy.
@@leezhieng I think you should do some basic research before commenting further.
You guys and Money & Macro should make a collaboration on a topic that you (mostly) agree on. I'd look forward to such a video.
Good work!!
Good question. Another one you should ask is: How much does the US lie about its economic statistics??
Dude, I love you. You should have 75 million subs.
little pink and 50cent party members are going to love this one
Thanks for uploading it to spotify
If China says 1 person is unemployed it mean 10, if 10 then 100.
I mean it makes sense
So then the 15 trillion dollars GDP is actually 1.5? Yeah they lie about stats but not by a whole order of magnitude
And America says it's foreign policy is to bring peace and democracy to the rest of the world...
@Apsoy Pike woosh
@@apsoypike1956 they probably lie and inflatable or deflate numbers by double.
Genius, firstly, disposable income is usually less than the capital per GDP. And now u are talking about China’s GDP per capital is less than 4500 dollars. That’s roughly 30,000 RMB. I find it hard to believe even based on my own 32 years experience.
can you make all fake gdp comparison between country like japan usa china ireland england etc?
its more specific to China because Japan, USA, Ireland, UK are all democracies, which means their data is essentially public and openly countable. China is closed off so it can basically report its own
A bit confused about GDP per capita. 16:35 GDP is 9 trillion. Population per google is 1.4 billion. Should the number at 17:30 be 6,400 instead of 4,500?
9 trillion from 17 trillion seems too far out lol. I was expecting around 11 to 12 trillion for China real gdp.
Nahh, they're authoritarian they pretty much lie as much as they want
Good man for shouting out money and macro! 👍
CLAPPING WITH MY HANDS AND FEET. Not a CCPhile here but I do study china and this was one of the most level headed economic comments on YT
I have a questions can companies like Apple lie about there income figures 9:54
You can actively track their sales so not really
“How much”
Yes
Title is equivalent to the old “Is the pope catholic?” “Does a bear sht in the woods?”
You should try Ireland on that assumption
EE has already done an Ireland episode.
@@piuthemagicman How could I forget? LMAO
That was a god awful video.
Shutup, Ireland is 2nd
Ireland is a democracy so it can be actively analysed, china you just take their word
Those low figure does not make any sense whatever the perspective you look at. If China has a GDP per capita of 4.5k and India has a 2.27k. China, in every metrics are more than double of India. You can look at hard data like export, import and energy consumption or you can look from the on the ground experience in the cities and villages, China is many magnitudes better. If anything, its likely that China vastly under count their GDP compared to many other economies.
No offense but I'm a Master of Finance and Physicist and I have a question - How much do YOU lie about YOUR economic prowess? Your presentation on Ben Bernanke the other day wasn't even high-school level it was an utter disgrace. Do you even have a degree in economics?
good questions.
There are alot more to a society than GDP per capita would suggested. Australia, Canada, New Zealand and lots of northern European countries have a much lower GDP than the US. But wealth equality, social security and Crime rate statistics are so much better, which make it much wealthier society for the vest majority. I would say the same about China. Although China is still a relatively poor country per GDP by capita, on the street level, poorer population live a much more dignify, safer and harmonious lives compared to comparable communities of many other nations.
Why not use your original score and the adjusted score in the rankings going forward? At the end you mentioned you will keep Chinas original score going forward because many other countries also misreport economic data. But among the countries you have near the top, China is alone on how much they manipulate it. And considering their manipulation is estimated to be as much as over 2x the actual gdp data, it would make sense to keep both scores going forward.
They went from 8.2 to 7.4, a large enough jump out of 10, but not double. As EE mentions toward the end, their growth is still good, and the manufacturing and service sectors are still strong. The overall score doesn't fall as significantly as it might appear.
@@Lawrence330 they drop several positions which is important. 8.2 to 7.4 is a big decline when you consider 0.8 in these comparisons is several positions and will grow in number of positions in between as he does more countries
@@Lawrence330 of course you responded to me elsewhere with typical CCP propaganda and here you defend china again.
@@Lawrence330 the poster you are replying to is likely an astorturfer - he engages in large threads with anti-china comments under any video even remotely related to china, he posts the same arguments over and over again and rejects or pretends he doesnt see any evidence that goes against his narrative. He is a bot do not engage with him. He has been caught in the act under multiple videos doing this and in a thread under another video he was exposed as posting from Eglin Airforce Base
Not anymore
When did you do the USA on your little leaderboard! I missed it. I've missed a few but there's an episode I'd like to watch
"Does China lie about its economic statistics?" Without watching the video, I'm going to say "Yes".
是的，这句话适用于任何国家