China's economy smaller in new measure, still number two: study

http://news.yahoo.com/s/afp/20071217/bs_afp/worldbankeconomysurveychina_071217150618


Ok, China goes from 14% to 9%, USA from 29% to 23%. China is still less than half the America economy, a fact lost on several members of this group.

What happened to Japan?

Japan is the second largest on my most recent information. Reading the newspaper *LOL* either way while China does do a lot of cheap stuff really well and there are areas of China that are real boom wealthy areas poverty is also a major factor in a large part of the country.

Will it ever be bigger than the US economy? Can't say. Numbers and the Chinese love of doing business suggest it could be but that is far from a done deal. The US has been so outstanding at doing it better time after time so I would suggest it is a long way from being over run by anyone at present.

Stephen

Someone should tell the BBC about this.

Article this morning about Japan on the BBC web page:

Lacklustre growth and lingering deflationary pressures in the world's second largest economy mean that the bank is expected to refrain from raising its key rate until the latter half of 2008, analysts say.

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and

Mrs Ota said that while domestic demand would be playing a key role in boosting the nation's economy, growth in consumption would be limited because "wage increases will likely continue to be moderate".

She also warned that if the slowdown in the US - Japan's largest export market - continued then next year's growth "may be lower than the projection".

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Home demand to drive Japan growth

The world's second largest economy is dependent upon the world's largest economy. And China is dependent upon both.

World Bank ranking of GDP (2006, the most recent full year available):
http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP.pdfUnder "purchasing power parity" adjustments (where currency valuations and local prices considered), China is #2 largely due to undervalued yuan.

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)
(raw data from the International Monetary Fund is here, but it's unsorted: http://www.imf.org/external/pubs/ft...,582,443,474,917,754,544,698&s=NGDPD&grp=0&a=

I like how someone smuggled the "European Union" into the list. The Treaty of Lisbon was an attempt to run around the defeats of a "constitution" in the last few years. It's been signed, now they have to make it work.

Gene

I've been skeptical of how the US GNP is calculated - they apparently include all sorts of "off the books" transactions, like what family members do for one another. That crap started in the 1990s, along with a new fancy way of computing inflation, one that ignores certain "core sectors".

By this measure, that we pretend that Mom is a paid housekeeper and that the kids are unpaid landscapers one would think that India and China were much larger than claimed, given that they have three or four times as many people as the US.

Denominating it in terms of currency is misleading - we can't pretend that Wang or Satish would be paid the same as their US equivalents. They'd be just as expensive to support over here as their US equivalent.

I don't personally see the big deal in ranking. It's not how big you are but how well you work.

Gene

I wonder if they count the advice given on this forum, and give it a value as consulting?