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Win-win? Assessing the global impact of the Chinese economy

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  • Herrala, Risto
  • Orlandi, Fabrice

Abstract

We study the global impact of the Chinese economy based on a novel indirect approach where the spillover effect is quantified from a forecast error model under relatively favorable identifying con-ditions. Findings from the real-time World Economic Outlook data over the period 2004-2015 indicate that an increase in economic growth in China had a negative impact on most other economies one to two years ahead. The estimations furthermore uncover evidence at the global level that spill-over propagated by influencing prices, including global commodity prices, which tend to increase in reaction to accelerating economic growth in China.

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  • Herrala, Risto & Orlandi, Fabrice, 2020. "Win-win? Assessing the global impact of the Chinese economy," BOFIT Discussion Papers 4/2020, Bank of Finland Institute for Emerging Economies (BOFIT).
    • Handle: RePEc:zbw:bofitp:bdp2020_004
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    References listed on IDEAS

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    More about this item

    Keywords

    Chinese economy; global spillover; real time data;
    All these keywords.

    JEL classification:

    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • F15 - International Economics - - Trade - - - Economic Integration
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles

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