Noise or Systematic Misreporting of National Accounts?

Abstract: In the NBER Working paper ”Measuring Economic Growth From Outer Space” it is suggested that 29 countries have reported GDP that differs from “true” GDP. In this bachelor’s thesis these countries are examined and a common denominator for them is sought after. None is found, but other interesting discoveries are uncovered hinting that the discrepancy from “true” GDP is not just noise. A connection is revealed where it seems like the level of autarchy influences the level of GDP overestimation. Another relationship is found that tells us that the there is a connection between the dependency on foreign aid and underestimation of GDP. Lastly, a third correlation is discovered, which suggests that countries experiencing high growth more often overestimate their GDP and countries experiencing low growth more often underestimate their GDP. The number of observations that have GDP that differs from “true” GDP is however small, which means that these results must be taken with caution. They are to be considered as the first clues in yet unlocked mysteries.