Monday 6 December 2010

Measuring GDP for real

Another thing to thank Wikileaks for:

GDP figures are “man-made” and therefore unreliable, Li said. When evaluating Liaoning’s economy, he focuses on three figures:

1) electricity consumption, which was up 10 percent in Liaoning last year;

2) volume of rail cargo, which is fairly accurate because fees are charged for each unit of weight; and

3) amount of loans disbursed, which also tends to be accurate given the interest fees charged.

By looking at these three figures, Li said he can measure with relative accuracy the speed of economic growth. All other figures, especially GDP statistics, are “for reference only,” he said smiling.

So, how would that set of measures work in our case?

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1 comment:

AntiCitizenOne said...

We can use Ricardos law and see what's happening to rents in order to calculate economic growth obviously some adjustment for credit changes is needed.