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Can They Calculate Real GDP at BusinessWeek?

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Wednesday, 21 April 2010 04:40

It doesn't seem they can. They told readers that Colombia's GDP has doubled since President Uribe took office in 2002. That's not what the IMF says. According to the IMF, the increase has been just over 40 percent during this period. That's respectable growth, but it sure is not a doubling of GDP.

Calculating real GDP is a recurring problem at top media outlets. In December of 2007, in order to argue that the case that NAFTA had been a great success, a Washington Post editorial told readers that Mexico's GDP had quadrupled between 1988 and 2007. In reality, the increase had been just 84 percent. While a huge "nevermind" would have been in order, the Post lacked the integrity to print a correction and own up to this mistake.

 

[Addendum: BusinessWeek has corrected its mistake. We're still waiting on the Post.]

 

Comments (3)Add Comment
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written by izzatzo, April 21, 2010 8:08
Nominal is phenomenal except when it's not.
Real is the deal for reporters who forgot.
That prices adjusted mean no prices at all.
Just output from inputs is the referee's call.
3 cheers for izzatzo
written by Aditya Savara, April 21, 2010 10:38
Your "poetry" has added a whole new dimension to Beat the Press. I hope you have the time and the creativity to keep it up every so often.
...
written by Ben Zipperer, April 21, 2010 11:35
Using the BusinessWeek methodology, Venezuela's GDP more than quintupled since Uribe took office! And grew by 1,273 percent since Chavez was elected! Wahoo!

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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