Gao Shanwen’s Uncomfortable Questions About China’s Economy
Gao Shanwen (高善文), one of China’s better-known macroeconomists in the securities industry, died of cancer on July 7 at the age of 55. He was known for using economic data to question conventional assumptions. . .
Gao Shanwen (高善文), one of China’s better-known macroeconomists in the securities industry, died of cancer on July 7 at the age of 55. He was known for using economic data to question conventional assumptions about China’s growth, inflation, asset prices and economic cycles. Gao, formerly chief economist at SDIC Securities, attracted international attention in late 2024 after estimating that China’s reported GDP growth between 2021 and 2023 may have been overstated by as much as 10 percentage points, according toReuters. His remarks subsequently drew scrutiny, with his speech and reports carrying his comments disappearing from China’s tightly controlled internet. A profile published by the Peking University HSBC Financial Research Institute records a self-deprecating couplet Gao had written to express his astonishment at economic trends:“When explaining the past, I can make perfect sense of it, and it seems reasonable; when predicting the future, I dodge and hedge, yet the errors are astonishing. ” (解釋過去頭頭是道，似乎有理；預測未來躲躲閃閃，誤差驚人)Its accompanying horizontal inscription read: “Economic Analysis. ” （經濟分析）SIGN UP FOR OUR FREE NEWSLETTERFor the best of our weekly content！There is something wrong, please try again laterSuccessYou are now signed up for our newsletterSuccessCheck your email to complete sign upThe joke captured one of the central difficulties of Gao’s profession: economic data can make past developments easier to explain than future ones. But Gao became notable precisely because he was willing to question some of the assumptions underlying China’s official economic picture. A focus on what the headline numbers missedOne of Gao’s most discussed arguments concerned China’s post-pandemic consumption slowdown. In aDecember 2024 speechin Shenzhen, he described a country with “energetic elderly people, dispirited young people, and middle-aged people who had lost the will to live. ”The phrase spread widely because it turned a complicated economic trend into an easily understood observation. Gao was referring to data suggesting that provinces with younger populations were experiencing weaker consumption growth, while provinces with older populations were doing comparatively better. Before the pandemic, he said, there had been little relationship between the age structure of a province and its consumption growth. After the pandemic, however, “the two showed a textbook negative correlation—the younger a province’s population, the more slowly its consumption tended to grow. ”The implication was that demographics alone could not explain China’s weak consumption. Factors such as employment uncertainty, property prices, income expectations and local government finances could also be affecting household behavior. Gao’s December 2024 appearance at the Peterson Institute for International Economics in Washington brought some of these concerns to an international audience. The Dec. 12 event, “The US and Chinese Economic Outlook,” was co-hosted by the Peterson Institute and the China Finance 40 Forum (CF40), with Gao participating as a CF40 representative. His comments subsequently attracted official scrutiny. A Wall Street Journal reportpublished on Jan. 8, 2025, titled “Xi Jinping Muzzles Chinese Economist Who Dared to Doubt GDP Numbers,” reported that Gao had faced repercussions over his remarks. Reuters later described him as an “outspoken” economist. The circumstances surrounding his illness have also prompted speculation. Gao’s first symptoms reportedly appeared in early 2024, before his most widely circulated remarks later that year. He was subsequently diagnosed with an aggressive form of hematological cancer. It is not possible to establish a connection between his illness and his public comments, and there is no evidence presented here to suggest one. What is clearer is that his economic analysis had become increasingly uncomfortable for authorities at a time when Beijing was emphasizing confidence in China’s growth prospects. READ MORE:Zhu Rongji’s Death Rekindles Debate Over Human Cost of China’s Economic ReformsTsinghua Professor Removed From Lecture After Student Reports Comments Critical of China’s EconomyFormer Chinese Premier Zhu Rongji, Known for Forceful Reform Efforts, Dies at 98A cautious voice in an increasingly difficult economyChinese official media treated Gao’s death with relative restraint. TheShanghai Securities Journaldescribed him as “one of the more influential macroeconomists in China’s capital markets. ”That wording contrasted with international coverage. Bloombergdescribed him as “a top Chinese economist who questioned official GDP data,” while Reuters called him “outspoken. ”Gao’s career nevertheless extended well beyond disputes over GDP statistics. He studied China’s economic cycles, asset prices, inflation and consumption, often attempting to explain developments through data rather than political slogans. His analysis of demographics and consumption was particularly relevant as China confronted a difficult combination of weak domestic demand, a property downturn and changing expectations about future income. A younger population would normally be expected to support consumption, making the post-pandemic relationship Gao identified worthy of further investigation. His most memorable comments also reflected the limits of economic forecasting. His self-mocking couplet acknowledged that even analysts who can construct convincing explanations of the past frequently struggle to predict what comes next. Gao’s death removes a prominent voice from China’s financial and economic community. His legacy is likely to rest less on any single forecast than on his willingness to ask whether the country’s headline figures adequately captured conditions on the ground—and to look for evidence in less conventional indicators when they did not. By Meng Hao, Vision Times