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<p>This paper examines how political competition is related to the integrity of official economic data in China’s county-level governance, focusing on two types of data distortion: data opacity, which involves withholding information, and data inflation, which involves exaggerating reported figures. The study distinguishes between intra-jurisdiction competition, captured by the number of public positions held by a county leader, and inter-jurisdiction competition, measured by the number of counties within the same prefecture. To address endogeneity, I use a two-stage least squares (2SLS) model with instruments based on historical figures or administrative structure. The results suggest that when a county leader holds one additional public position–a proxy for lower intra-jurisdiction competition–the probability of data concealment increases by 20 percentage points. In contrast, adding five peer counties within a prefecture–reflecting greater inter-jurisdiction competition–reduces the marginal effect of economic performance on concealment by 4 percentage points. However, greater inter-jurisdiction competition is also associated with inflated GDP figures, overstated by 10.2% to 17.5% relative to satellite-based estimates. These findings suggest a tradeoff: while political competition may reduce opacity, it also creates incentives for strategic exaggeration, highlighting the complex consequences of political incentives for data integrity in authoritarian regimes.</p>

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Political competition and Chinese official data

  • 期刊论文

  • 发表日期：

    2025年6月23日

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  • Chia-Yu Tsai

摘要

This paper examines how political competition is related to the integrity of official economic data in China’s county-level governance, focusing on two types of data distortion: data opacity, which involves withholding information, and data inflation, which involves exaggerating reported figures. The study distinguishes between intra-jurisdiction competition, captured by the number of public positions held by a county leader, and inter-jurisdiction competition, measured by the number of counties within the same prefecture. To address endogeneity, I use a two-stage least squares (2SLS) model with instruments based on historical figures or administrative structure. The results suggest that when a county leader holds one additional public position–a proxy for lower intra-jurisdiction competition–the probability of data concealment increases by 20 percentage points. In contrast, adding five peer counties within a prefecture–reflecting greater inter-jurisdiction competition–reduces the marginal effect of economic performance on concealment by 4 percentage points. However, greater inter-jurisdiction competition is also associated with inflated GDP figures, overstated by 10.2% to 17.5% relative to satellite-based estimates. These findings suggest a tradeoff: while political competition may reduce opacity, it also creates incentives for strategic exaggeration, highlighting the complex consequences of political incentives for data integrity in authoritarian regimes.