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Recent macroeconomic stability in China

Listed author(s):
  • He, Qing
  • Chen, Haiqiang

The volatility of Chinese GDP growth has been markedly lower since the mid-1990s. We utilize frequency domain and vector autoregression (VAR) methods to investigate the origin of the observed volatility reduction in the Chinese economy. Our estimation indicates that lower volatility of random shocks to the economy, or the good luck hypothesis, accounts for most of the decline in macroeconomic volatility. Although good policy and better business practices are also contributing factors, they play a marginal role in dampening China's economic fluctuations.

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File URL: http://www.sciencedirect.com/science/article/pii/S1043951X13000473
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Article provided by Elsevier in its journal China Economic Review.

Volume (Year): 30 (2014)
Issue (Month): C ()
Pages: 505-519

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Handle: RePEc:eee:chieco:v:30:y:2014:i:c:p:505-519
DOI: 10.1016/j.chieco.2013.07.005
Contact details of provider: Web page: http://www.elsevier.com/locate/chieco

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