Macroeconomics Case Study

National Income Accounting: A Case Study of China

OR

Abstract:
This case study was written primarily to illustrate and to know the calculation of GDP, GNP, Nominal GDP, Real GDP and the related concepts in the backdrop of Chinas’s economy. After three decades of central planning it was time for China to emerge from isolation and become an important player in the world economy. Economic reforms since 1978 have taken China to a new trajectory of growth. Evolution into a controlled-open economy has synchronised the movement of macroeconomic variables like growth rate, inflation, and exchange rate, with the rest of the world. Any policy change in China now has its impact on the world economy.

Pedagogical Objectives:

• To understand the evolution of China’s economic growth
• To debate on the inequalities between the geographical regions within China
• To understand macroeconomic concepts using China as an example
• To analyse the movement of economic variables in the background of reforms in China
• To understand the interrelationships between macroeconomic variables like GDP, GNP, potential output, inflation, interest rate and exchange rate.

Keywords : Economics; China's Economic Growth; GDP (Real & Nominal, Potential & Actual); Inflation; Interest Rates; Exchange Rates; Economic Reforms of China; Income Disparity; National Income; Currency Revaluation & Devaluation

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