Paper: "Consumption Based Estimates of Urban Chinese Growth"

IMF paper: Urban inflation in China was pro-poor.  Given rising inequality this is a ray of sunshine.

It is interesting to note that consumption growth is put at 6.8% a year at a time when official growth statistics were generally over 10%.

"ConsumptionBased Estimates of Urban Chinese Growth" 

IMF Working Paper No. 13/265

MARCOS CHAMON, International Monetary Fund (IMF) - Research Department


IRINEU DE CARVALHO FILHO, International Monetary Fund (IMF)

This paper estimates the household income growth rates implied by food demand in a sample of urban Chinese households in 1993–2005. Our estimates, based on Engel curves for food consumption, indicate an average per capita income growth of 6.8 percent per year in 1993–2005. This figure is slightly larger than the 5.9 percent per year obtained by deflating nominal incomes by the CPI. We attribute this discrepancy to a small bias in the CPI, which is of a similar magnitude to the one often associated with the CPI in the United States. Our estimates indicate stronger gains among poorer households, suggesting that urban inflation up to 2005 in China was “pro-poor,” in the sense that the increase in the cost of living for poorer households was smaller than for the average one.