China's economic fluctuations and consumption smoothing: Is consumption more volatile than output in China?
This paper provides a fundamental study of China's consumption and output fluctuations. The most recent literature reports that, in the post-1978 period, detrended consumption is significantly more volatile than detrended output in China. This indicates the inability to impose consumption smoothing. However, in those previous studies, consumption of durables, which has some features of capital, as discussed in the real business cycle literature, was not separated from private consumption. This paper is the first to estimate consumer durables for China and their service values following the method introduced in Cooley and Prescott (1995). We adjust the consumption measure to make it consistent with the real business cycle literature, and find that consumption of durables is much more volatile than output, but non-durable consumption is less volatile than, and less correlated with, output that provides evidence that supports consumption smoothing in China.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Genevieve Boyreau-Debray & Shang-Jin Wei, 2005.
"Pitfalls of a State-Dominated Financial System: The Case of China,"
NBER Working Papers
11214, National Bureau of Economic Research, Inc.
- Boyreau-Debray, Genevieve & Wei, Shang-Jin, 2004. "Pitfalls of a State-Dominated Financial System: The Case of China," CEPR Discussion Papers 4471, C.E.P.R. Discussion Papers.
- He, Qing & Tai-Leung Chong, Terence & Shi, Kang, 2009. "What accounts for Chinese Business Cycle?," China Economic Review, Elsevier, vol. 20(4), pages 650-661, December.
- Ravn, Morten O & Uhlig, Harald, 2001.
"On Adjusting the HP-Filter for the Frequency of Observations,"
CEPR Discussion Papers
2858, C.E.P.R. Discussion Papers.
- Uhlig, H.F.H.V.S. & Ravn, M., 1997. "On Adjusting the H-P Filter for the Frequency of Observations," Discussion Paper 1997-50, Tilburg University, Center for Economic Research.
- Morten O. Ravn & Harald Uhlig, 2001. "On Adjusting the HP-Filter for the Frequency of Observations," CESifo Working Paper Series 479, CESifo Group Munich.
- Chong-En Bai & Chang-Tai Hsieh & Yingyi Qian, 2006.
"The Return to Capital in China,"
NBER Working Papers
12755, National Bureau of Economic Research, Inc.
- Chow, Gregory C & Li, Kui-Wai, 2002. "China's Economic Growth: 1952-2010," Economic Development and Cultural Change, University of Chicago Press, vol. 51(1), pages 247-256, October.
- Gregory C. Chow, 1993. "Capital Formation and Economic Growth in China," The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 809-842.
When requesting a correction, please mention this item's handle: RePEc:eee:chieco:v:23:y:2012:i:4:p:918-927. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.