The World Bank Responds on Chinese Poverty Forecast

In response to my earlier post on the World Bank’s China poverty forecast I received the following reply from the Bank’s poverty team, which (at their request) I am happy to post here in full. Below their response I offer a few further comments.

Thanks for your interest in the World Bank’s poverty estimates and forecasting. As we often have said, these poverty forecasts are only reliable at the aggregated level, not at the individual country level. That’s why we do not normally release country-level forecasts.

That said, the Bank’s poverty team has no serious concerns about the quality of China’s 2008 survey data. Nor do we want to hide our poverty projection for China in 2015.

The easiest way to answer your questions is to show you our estimates. I am attaching the poverty estimates for China here which has exactly the same format as the GMR 2011.

Please notice that China conducts rural and urban household surveys separately. The national poverty estimates are the population weighted average from rural and urban poverty measures. China’s National Bureau of Statistics will soon release new urban population share from the 2010 census, and the time series of urban population share between 2000 and 2010 will also be updated. So, too, will the World Bank’s poverty estimates for China. But as of now, these are our best estimates.

Your blog said that “the most recent poverty survey for China, which covers the year 2008, has been the subject of considerable rumours in the past. Specifically, there was quite a long delay from when many people thought the results would be released to the public until when they actually were, which was just a few months ago.”

That is simply wrong. The delay in the public release of the World Bank’s poverty numbers had nothing to do with China. Rather, it was due to delays in the access of the data for a number of countries in Africa.

Sincerely,

Shaohua Chen
Senior Statistician
Development Research Group
World Bank

 

First off it’s great to have the World Bank respond on these issues, and especially great to respond by sharing the data. It’s still not particularly clear to me why the China projection was left off of the official publication this year; if the China story is interesting and important enough to merit its own line on the table – as I certainly believe it is – and the Bank has faith in the projection, then surely the 2015 figure should be included in the table, rather than listed as “not available”. But in any case, it’s great to now have the figures.

And indeed I’d argue it’s particularly important to highlight the China figure as it’s seen a rather substantial revision; last year the Bank thought in 2015 there would be just 66 million Chinese living in poverty, and this year that projection has risen to 100 million, a 50 percent increase. That’s an important change, and one that deserves to be discussed. Personally my guess is that it’s far too high, and that several years from now when we have the full data the actual 2015 figure will be considerably lower; time will tell. (Incidentally, it’s possible the 100 million figure is about right as an “expected value” prediction rather than a baseline prediction, in the sense that there are multiple possible equilibria for China’s future, including some unlikely-but-possible ones involving a hard landing, where poverty stops declining altogether or potentially even increases. So there’s a high (baseline) probability there will be fewer than 100 million Chinese living in poverty in 2015, but a small probability there will be much more, which could balance out to something like 100 million. But that’s not how people usually think about poverty projections.)

Finally, one small point of clarification: in the original post I did not mean to suggest that the China data was the reason for the delay of the overall new poverty results released earlier this year, but rather just that there were delays with the China data itself, such that China was not included in the April 2011 Povcal update…

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