China, world's first economy this year

[Francesca R]

Not meaningless, they just don't say what you supposed. Setting aside PPP or market FX rate conversion, the story is that on one of these measures the value of all output produced / income earned in China is greater than the same in the USA, which is not per-person so has nothing much to say about relative living standards.

 

[rjh01]

Thank you Francesca R.

 

[Puppycow]

Interesting related thread from 2005:

http://www.internationalskeptics.com/forums/showthread.php?t=36671

 

[lomiller]

Interesting related thread from 2005:

http://www.internationalskeptics.com/forums/showthread.php?t=36671

meh. basic premise of that thread is seriously flawed. GDP gains by converting peasant farmers to low paid factory workers only gets you so far. Even after all the peasant farmers are converted to low paid factory workers China will still have a lower GDP per capita than the US. At that point they need to start converting low paid factory/service sector workers to high paid professionals like the US has been doing for 50 years.

 

[Puppycow]

Yeah, I'm skeptical that the prediction will come true. 9 years in, they have made up some ground. I think Chinese per capita income in 2005 when the article was written was about 14% of the US and now it's more like 18%-19%. But growth is already showing signs of slowing. It was never going to average 8% for another 25 years.

 

[aleCcowaN]

Interesting related thread from 2005:

http://www.internationalskeptics.com/forums/showthread.php?t=36671

Related? Relatively

That thread's year the GDP PPP of the United States was almost exactly a double of China's. Now they are equal. In some, what, 12 years? it'll be the double. I intended this thread more like to discuss how an international crisis beginning in Shanghai and not in New York would develop.

 

[theprestige]

I intended this thread more like to discuss how an international crisis beginning in Shanghai and not in New York would develop.

In that case, purchasing power parity is the worst metric to start from.

China's effect on the global economy has a lot more to do with its relative GDP, trade parity, commodity positions, currency exchange rate... hell, even its growing ability to project naval power is more of a factor in Shanghai's ability to cause an international crisis, than China's PPP.

I don't think anybody in this thread actually disagrees with your whole "China stronk!" meme. It's just that China's PPP doesn't really showcase it.

 

[aleCcowaN]

In that case, purchasing power parity is the worst metric to start from.

What a wrong thing to say!

People who think PPP is sort or a stance should keep themselves away of discussions like this one. Most of all if they cultivate notions of power strange to economic sciences.