The Hierarchical Decomposition of China's Provincial Growth Uncertainty and Its Impact on Output and Inflation
Nowadays,China's economic growth shows a new character of weak recovery with a trend of regional differentiation.Decomposing the provincial growth uncertainty from a longitudinal dimension,and dynamically tracing the output and inflation effects of it are the basic premise to realize macro-fluctuations tracing and to achieve a hierarchical governance of macro-economy.Therefore,this paper firstly uses SV-TVP-DF model to decompose China's provincial growth uncertainty into consistent factor at the nationally level,synergetic factor at the regional level and individual factor at the provincial level,then uses variance decomposition and PCH-VAR model to investigate their heterogeneous effects on output and price volatility.We find that when a serious crisis event occurs,China's growth uncertainty will rise rapidly,and the uncertainty of eastern provinces rises more significantly,which is the main leader of growth uncertainty.We also find that national growth uncertainty and provincial individual uncertainty are the core driving factors of output and price fluctuations respectively,in which output fluctuations are mainly affected by national growth uncertainty,while price fluctuations are mainly driven by provincial uncertainty.In addition,the research shows that in terms of preventing and resolving growth uncertainty,moderately active fiscal policies combined with reasonably loose credit policies should be adopted at present to guide economic recovery,which can not only effectively boost economic vitality,but also control price fluctuations within an appropriate range,so that enhance the certainty and stability of economic recovery.
Growth uncertaintyMacro-economic fluctuationsSV-TVP-DF modelPCH-VAR model
万方数据
维普
