Statistics Research On The Financial Crisis's Spatial Contagion And Its Impact On Chinese Economic

It is well known that the Global Financial Crisis,derived from the 2007 U.S.Sub-prime Crisis,was overwhelming in its range,spread speed,influence and damage,and triggered the worst financial crisis and economic recession the world ever witnessed since the Great Depression in 1929.In December 2015,Fed raised the interest rate,the first ever in the last decade or so,putting US economy on the path of recovery ahead of others nations and resulting in the overall international financial market and economic development entering into a new phase that looks relatively stable outwardly but internally were rather fragile.At the meantime,China,who is experiencing a decreasing GDP growth,industrial structure upgrade,negative growth in foreign trade,reform entering deep water area,as well as L-shaped economic growth pattern,would be greeted with bigger opportunities and challenges,particularly in view of Fed's announcement in Mar 2018 of its interest rate hike plan(three times to be expected in 2018,25 bps increase each time),and the official launch of the US-China trade war by Trump who would slap tariff on 60-billion-USD goods imported from China.Chinese government and academia attached great importance to this crisis.On the G20 summit convened in 2016,Chairman XI Jinping suggested the inclusion of several topics into the conference theme,namely,improvement of international monetary system,establishment of an inclusive and orderly global financial system,and the development of green finance.Such proposal highlighted the stance of our top leaders in tackling the potential systematic financial risk and maintaining the stability of international financial system.In the following 19 th CPC National Congress held in Oct.18,2017,Chairman XI Jinping pointed out again that “the risk premium effect,incurred by some countries' adjustment to their monetary policy and fiscal policy,may bring external impact to our financial safety.Therefore,we must unswervingly uphold the bottom line that guards against the systematic financial crisis.” He also mentioned three tough battles to fight for the achievement of a decisive victory in building a moderately prosperous society,and these battles are preventing and addressing the major risks,taking targeted measure in poverty alleviation,and pollution prevention and treatment.Among them,the foremost battle is “preventing and addressing the major risks” in which the key is to prevent financial risk,including preventing systematic financial crisis from happening and guarding against external impact incurred by international financial crisis contagion.In view of the fact that each financial crisis,when compared with the last ones,would exhibit some new changes and features,the academia has not yet reached a well-formed authoritative systematic theoretical system concerning the research of financial crisis and its contagion path,and therefore more works needed to be done on this regard.It is fair to say that,the exploration on the international financial crisis contagion path at different historical background and economic development phase is of great practical significance and theoretical value.Through the review and summarization of existing documentations home and abroad concerning the research on the formation and contagion path of the financial crisis,as well as the result of the empirical research,we found that the research targeting the financial crisis contagion path is still the emphasis and challenge for the academia,and that the adoption of two dimensional spatial economics featuring time and spatial metrics are becoming a primary trend for such research.To have a real understanding of the contagion effect of the global financial crisis,one needs to figure out the formation path of the crisis.The paper,by focusing on the analysis of the 2007 crisis,disclosed two new major patterns: 1)this crisis was incubated in virtual economy and spread independently in the financial system;2)its contagion speed was unrivaled by other crisis.Further research concluded that the crisis was incurred and spread with the help of combined efforts of neoliberalism,economy virtualization and international monetary system.Based on the above,the paper measured the G20 countries' financial crisis pressure caused by the contagion of the global financial crisis.The paper,by utilizing the panel data of the G20 countries from Jan.2015 to Dec.2016,explored the use of Multiple Indicator Multiple Causes model,established financial crisis pressure metric system,discovered the significance impact factor of the financial crisis pressure in various countries within the G20 group,and measured each country's financial crisis pressure index which was served as the Explained Variables for the following spatial panel data model.Moreover,the paper studied and constructed spatial panel data model to analyze the spatial contagion of financial crisis.The paper also established space weight matrix of economic geographic distance function and created dynamic and Non-dynamic spatial panel Durbin model for the contagion of financial crisis,so as to study the financial crisis' s spatial contagion path and effect in open economic system with an emphasis on the study of the hysteresis quality of its spatial contagion,meanwhile comparing such Durbin model's direct and indirect effect in both short term and long term,and therefore concluded that the dynamic spatial panel Durbin model(with spatial random effect and period fixed effects)for the contagion of financial crisis is more effective,and that its effects' effectiveness and the model's explanatory power are stronger.The paper showed that the utilization of this model to conduct global financial crisis contagion research is scientifically reasonable and appropriate.At last,the paper,by examining the significance factors influencing China's financial crisis pressure and the concrete path for the spatial contagion of 2007 global financial crisis,studied the crisis' s impact on China's economic operation and classified such impact into 3 periods,namely,crisis incubation period,outbreak period,impact persistent period,and identified 4 paths for the crisis contagion to China,namely,internationalization of RMB,foreign trade,financial market and real estate.The paper then summarized the issues existed during the operation of the above 4 sectors and thereby offered policy and advice on what China can do to prevent and address the major risks,in particular the systematic financial crisis,and to guard against the external impact brought by international financial crisis to Chinese economic operation.