The role of China in the world economy: evidence from global VAR model

Anna Sznajderska
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Anna Sznajderska: Warsaw School of Economics, Narodowy Bank Polski

No 270, NBP Working Papers from Narodowy Bank Polski

Abstract: Since the 1980’s China has experienced very high economic growth and its share in global trade has increased rapidly. Nowadays, however, the Chinese economy is rebalancing and its growth is slowing. The paper investigates the spillover effects of a negative demand shock and negative stock price shock in the Chinese economy on other countries. We apply a GVAR model, that enables us to model international linkages between countries. Our results show that a one percent negative China GDP shock reduces global growth by 0.22% in the short run. We find that GDP shock affects emerging economies more strongly than advanced economies. We also show that stock prices shock affects only emerging economies and does not affect advanced economies.

Keywords: global VAR; China’s slowdown; spillovers (search for similar items in EconPapers)
JEL-codes: C32 E32 F10 O53 (search for similar items in EconPapers)
Pages: 40
Date: 2017
New Economics Papers: this item is included in nep-int, nep-mac and nep-tra
Note: The author is grateful for helpful comments and discussions seminar participants at 27th International Trade and Finance Conference in Poznań and 9th Economic Challenges in Enlarged Europe Conference in Tallin.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The role of China in the world economy: evidence from a global VAR model (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpmis:270

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