A Study Of Asymmetry Of Persistent Economic Growth In China

Facing the reality that China's economy is in the new normal,in order to understanding correctly the business cycle and economic growth's asymmetry characteristics and clarifying the economy transformation mode and its internal evolution mechanism of each phase as well as finding out the characteristics of macroeconomic policies and analyzing reasonably their implementation effects in each phase,this paper firstly uses AIC information criteria,LR test and residual Q test to confirm the optimal model that can simulate the quarterly GDP growth rates of China is three permanent regimes MS-UC model,which means structure changes cause the asymmetry of business cycle fluctuation and economic growth in China,and it's mainly embodied in the difference of the shock variances,the state transition probabilities and the drift as well as the variable coefficients in each phase.According to the estimation results from the model,the economic growth in China could be divided into three phases related to the economic policies according to supply and demand management: from the second quarter of 1992 to the second quarter of 2007,the high-speed development phrase;from the third quarter of 2007 to the third quarter of 2011,the shift phrase;from the fourth quarter of 2011 up to now,the new normal.After reducing MS-UC model to ARIMA model,we can measure the economic growth effects of different policies by phrase-dependent impulse response functions,and the result shows that in the phase dominated by supply management,policy shock has remarkable long-run growth effect;while in the phase dominated by demand management,policy shock mostly has short-run growth effect.In addition,in order to further illustrate the applicability of the model to economic and financial time series data and the authenticity and accuracy of the characteristics of macroeconomic policies from supply and demand sides,this paper uses relevant economic data of US,which country had also implemented the supply management reform,as a robustness test,and the result shows the similar conclusion.This research provides a strong empirical reference for the correct understanding of economic development at present and the adjustment of current economic policies in China.