Questioning China's decrease in poverty

"The leaders of the Group of 7 declared that poverty in developing countries has declined from 1990 to 1998 and cited data to support this from the MDB Report and the IMF. However, upon carefully examining the yardstick used to measure poverty and the footnotes in the MDB report, it appears that poverty is actually increasing!"

"The statistics for 1990 to start with are not too reliable. And a lot of the economic 'growth' of China is attributable to accounting for activities that went previously unaccounted for. For example, if a commune was feeding its own people, the only production that figured in national accounts was the surplus going to the market (or for state distribution to other areas). But if the same commune is now a cooperative or private activity and there are paid workers, in turn using their income to buy the food, both the salaries and the buying of the food increase the GNP and are thus registered as an enormous growth in income, even if the total production has not grown at all."

Chakravarthi Raghavan, Juggling Data to Claim Poverty Decline Third World Network, July, 2000

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