Analysis Of Business Circle In China

After entering the21st century, the world economy is developing rapidly, especially the development speed of our country, has maintained more than8%of the GDP in2012, which reached51.9trillion yuan, and our country has been known as the world’s second-largest economy. Urban per capita disposable income and per capita net income of rural residents growth were all higher than8%; Fiscal revenue increased to11.7trillion yuan; However08serious economic crisis brought the global economy crisis, the impact of deep, spread rapidly, with the fierce, rare in one hundred. Along with our country economic growth rate began to decline, the Chinese government focus decisively adjust the macro-control, introduced to further expand domestic demand, into steady and rapid economic growth of ten measures, the full implementation of the package,4trillion new investment in the past two years. Then according to the change of macroeconomic trends, timely adjustment of the macro-economic policy, timely withdrew from the stimulus, implement the positive fiscal policy and prudent monetary policy. Back in recent10years, in the face of international economic situation is complicated, the weakness of the severe challenges, effectively avoid the modernization in our country because of the huge impact and large economic fluctuations.Economic cycle is exist in any economic form a economy characteristic, therefore received the favour of economists for a long time, especially on the economic fluctuation problem research is particularly seriously, so the study of the economic cycle theory also flowers, combined with enterprise policy makers and government macroeconomic policy will be in the economic operation cycle, for reference, thus attracting the attention of government and corporate sectors.At present, the economics profession generally use SW index to represent the general running condition, the cycle economy. In terms of dynamic factor model, index of SW is represented by a factor of overall economic activity. However, macro economists agree that the macroeconomic cyclical fluctuations are caused by a small amount of impact, and through a series of activities to transfer and diffusion of economic variables. Any fluctuations in economic variables by itself is insufficient to represent the overall macroeconomic fluctuations. Factor model to dynamic process of data for large panel said, citing a few not observed factor driving the common part and each variable that heterogeneity characteristic of the sum of the parts. This thought makes the factor model is very suitable for macro economic and financial field.This paper discusses the static factor model and can be converted into the static structure of the theory and application of dynamic factor model. First of all, on the basis of summarizing the related literature at home and abroad, reviews the development course of the factor model, some important factor model is widely used for the classification, such as static factor model, the approximate factor model, the dynamic factor model, the generalized dynamic factor model, etc., and the theoretical assumptions of various factor model, the estimation method and application scope. Second, focus on the research focus in recent years, large approximate dynamic factor model. After pointed out that its defining hypothesis, discussed the factor applied to this model number estimation method and factor score of estimation methods. Finally, large approximate dynamic factor model was applied to the analysis of economic cycle fluctuation, to extract the influence factor of China’s economic cycle.