The Measure About Warning Point Of Warning System Between China’s Inflation And Economic Growth

Economic growth rate and inflation rate is basic indicators of measuring a country’seconomic operation condition. The research on operation law of economic growth andinflation provides strong support for our country to realize the macro-control policy about thesustainable development of economy. In this research, The first question is what’s theinfluence mechanism between inflation and economic growth. This article analyzes theinfluence mechanism between inflation and economic growth from the quantitative point, onthe basis of reasonable selection about relevant indicators, the VAR model is establishedbased on time series data, through the Granger causality test and impulse response function,pointing out both the effect of the economic growth rate on the rate of inflation and the effectof inflation rate on economic growth rate have the turning point. In addition to that,measuring the inflation warning point and the warning point of decline in economic growthrate based on the binary choice model. At the end of this article, according to two warningpoints and the influencing mechanism between inflation and economic growth, forwardingconstructive suggestions for our country to promote economic growth and ensure pricestability.