Comparisons of real output and productivity of Chinese and Indian manufacturing, 1980–2002

The principal objective of this paper is to compare the real output and labour productivity of Chinese and Indian manufacturing from 1980 to 2002. Using an industry-of-origin approach, purchasing power parities (PPPs) for the benchmark year 1985 are derived from the Chinese and Indian industrial censuses. In turn, the PPPs are used to convert Indian manufacturing GDP into Chinese yuan for direct comparisons. Secondary objectives are twofold: first, to set this direct comparison within the general context of the economic policy reform process followed in each country, and second, to compare and contrast the organisation and structure of both countries' manufacturing sectors. The analysis shows that since 1980, real value added and labour productivity growth for Chinese manufacturing has been well above Indian levels.