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Investment-Led Growth in China: Global Spillovers
Ashvin Ahuja,Malhar Nabar +1 more
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The authors quantifies potential global spillovers from an investment slowdown in China and finds that a one percentage point slowdown in investment in China is associated with a reduction of global growth of just under one-tenth of a percentage point.Abstract:
Over the past decade, China's growth model has become more reliant on investment and its footprint in global imports has widened substantially. Several economies within China's supply chain are increasingly exposed to its investment-led growth and face growing risks from a deceleration in investment in China. This note quantifies potential global spillovers from an investment slowdown in China. It finds that a one percentage point slowdown in investment in China is associated with a reduction of global growth of just under one-tenth of a percentage point. The impact is about five times larger than in 2002. Regional supply chain economies and commodity exporters with relatively less diversified economies are most vulnerable to an investment slowdown in China. The spillover effects also register strongly across a range of macroeconomic, trade, and financial variables among G20 trading partners.read more
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Trade Integration and Business Cycle Synchronization: A Reappraisal with Focus on Asia
TL;DR: In this article, the authors examined the relationship between trade integration and business cycle synchronization using new value-added trade data for 63 advanced and emerging economies during 1995-2012 and identified a strong positive impact of trade intensity on BCS.
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Towards Recoupling? Assessing the Global Impact of a Chinese Hard Landing Through Trade and Commodity Price Channels.
TL;DR: In this paper, the authors assess to what extent a hard landing in China would impact other countries, with a focus on trade and commodity price channels, and use a global VAR methodology adapted to conditional forecasting to simulate the impact of a Chinese hard landing.
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Dynamic spillovers and connectedness between stock, commodities, bonds, and VIX markets
TL;DR: In this paper, the authors examined dynamic spillovers and connectedness between stocks, commodities, bonds, and VIX markets and found that emerging equity markets are net receiver of shocks.
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The Long Landing Scenario: Rebalancing from Overinvestment and Excessive Credit Growth. Implications for Potential Growth in China
TL;DR: In this article, the authors provide an assessment of how, and to what extent, the rebalancing process may impact China's potential growth in the next fifteen years, and they adopt a production function approach to derive potential growth.
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Rebalancing China's Economy: Domestic and International Implications
TL;DR: In this paper, the authors consider the interactions between China's domestic and external imbalances and their global implications and present scenarios detailing how a rebalancing of China's growth pattern from investment-driven growth towards more consumption-dependent growth may occur in practice.
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Macroeconomic Forecasting Using Diffusion Indexes
James H. Stock,Mark W. Watson +1 more
TL;DR: This paper used principal component analysis (PCA) to predict macroeconomic time series variable using a large number of predictors, and the predictors were summarized using a small number of indexes constructed by principal component analyzer.