China’s economy shrinks by USD 4 trillion overnight

Wow. My friend Yam Ki just alerted me to this article in the New York Times. Basically, the World Bank’s measure of the purchasing power parity rate in China was based on numbers from the 1980s. This year those numbers got updated and, hey, it turns out that the Chinese economy is worth something more like USD 6 trillion, not USD 10 trillion. That means, among other things, that those oft-cited figures about the impressive number of people lifted out of poverty in China are way off: “Suddenly the number of Chinese who live below the World Bank’s poverty line of a dollar a day jumped from about 100 million to 300 million, roughly the size of the United States population.”

Eveline Chao