From International Herald Tribune:
New calculations by the World Bank, suggesting that the Chinese economy may not be as large as previously thought, are setting off a debate among economists over whether the calculations are accurate and what they should mean for the West’s currency policies toward China.
The World Bank issued preliminary figures Monday that recalculated what would be the economic output of 146 countries – including China – after excluding differences in domestic prices and currencies.
The so-called purchasing power parity calculations, which compare the buying power of citizens around the world, showed that China’s output was 40 percent smaller than previous World Bank estimates. [Full Text]