Jenni Pääkkönen

Comparing China's GDP Statistics with Coincident Indicators

We use factor analysis to summarize information from various macroeconomic indicators, effectively producing coincident indicators for the Chinese economy. We compare the dynamics of the estimated factors with GDP, and compare our factors with other published indicators for the Chinese economy. The indicator data match the GDP dynamics well and discrepancies are very short. The periods of discrepancies seem to correspond to shocks affecting the growth process as neither autoregressive models for GDP itself nor various coincident indicators are able to forecast them satisfactorily.

Changing Economic Structures and Impacts of Shocks: Evidence from a Dynamic Stochastic General Equilibrium Model for China

We present a small‐scale dynamic stochastic general equilibrium model that features price rigidities, habit formation in consumption and costs in capital adjustment. We estimate the key parameters and calibrate the model with data for the Chinese economy. Our interest centres on the impact of technology and monetary policy shocks for different structures of the Chinese economy. In particular, we evaluate how a rebalancing of the economy from investment‐led to consumption‐led growth would affect the economic dynamics after a shock occurs. Our findings suggest that a rebalancing would reduce the volatility of the real economy in the event of a technology shock, which provides support for policies aiming to increase the consumption share in China.

Changing Economic Structures and Impacts of Shocks - Evidence from a DSGE Model for China

We construct a small-scale dynamic stochastic general equilibrium (DSGE) model that features price rigidities, habit formation in consumption and costs in capital adjustment, and calibrate the model with data for the Chinese economy. Our interest centers on the impact of technology and monetary policy shocks for different structures of the Chinese economy. In particular, we evaluate how a rebalancing of the economy from investment-led to consumption-led growth would affect the economic dynamics after a shock occurs. Our findings suggest that a rebalancing would reduce the volatility of the real economy in the event of a technology shock, which provides support for policies aiming to increase the consumption share in China.