Back to Search
Start Over
Do sentiment indicators help to assess and predict actual developments of the Chinese economy?
- Source :
- Journal of Chinese Economic and Business Studies. 6:225-239
- Publication Year :
- 2008
- Publisher :
- Informa UK Limited, 2008.
-
Abstract
- This paper evaluates the usefulness of business sentiment indicators for forecasting developments in the Chinese real economy. We use data on diffusion indices collected by the People's Bank of China for forecasting industrial production, retail sales and exports. Our bivariate vector autoregressive models, each composed of one diffusion index and one real sector variable, generally outperform univariate autoregressive models in forecasting one to four quarters ahead. Similarly, principal components analysis, combining information from various diffusion indices, leads to enhanced forecasting performance. Our results indicate that Chinese business sentiment indicators convey useful information about current and future developments in the real economy. Moreover, the results could be seen as support for the reliability of the official data on the real economy, as both survey and real sector data seem to reflect the same underlying economic dynamics. … But historically, we always observed in the past that the...
- Subjects :
- Index (economics)
forecasting
diffusion index
VAR
China
Industrial production
Univariate
jel:E32
Bivariate analysis
jel:E37
ComputingMilieux_GENERAL
Variable (computer science)
Autoregressive model
Econometrics
Economics
jel:P27
Chinese economy
General Economics, Econometrics and Finance
Reliability (statistics)
Subjects
Details
- ISSN :
- 14765292 and 14765284
- Volume :
- 6
- Database :
- OpenAIRE
- Journal :
- Journal of Chinese Economic and Business Studies
- Accession number :
- edsair.doi.dedup.....99fff522bcc550df16bbc5aa9a91983e