The measurement of China’s consumer market development based on CPI data

Jiang Xiao, Minggang Wang, Lixin Tian and Zaili Zhen

Physica A: Statistical Mechanics and its Applications, 2018, vol. 490, issue C, 664-680

Abstract: Consumer Price Index (CPI) is a comprehensive index which contains a large amount of market information. In order to effectively measure the running status of China’s consumer market and analyze the dynamic evolution characteristics of regional economic consumption in China, the eigenvalues and eigenvectors of random matrix are proposed to quantitatively describe the evolution relationship of provincial and regional CPI in China. Based on the provincial data of China’s CPI, system risk entropy, synchronicity ratio, stability and market induction are introduced to characterize the market evolution characteristics, and analyze the regional differences and synchronicity of the consumer price index of China and evaluate the development of China’s consumer market. The results show that the average system risk entropy of China’s consumer market for the period 2000–2015 is 0.1646, fluctuating in the range of 0.0512–0.3288, indicating a higher system risk of China’s consumer market. The system risk of China’s consumer market is still higher than the average in nearly 15 years. Fluctuating in the range of 0.3871–0.9355, the market synchronicity ratio has a mean of 0.7225, which reveals a higher market consistency level, a rising trend in fluctuation but an increasing tendency in the degree of unbalanced regional development. Evolution results of market induction demonstrate that the evolution of China’s consumer market has experienced four stages. The market induction has possessed a sustained growth trend since August 2010. Scenario analysis indicates that the key to effectively improve China’s consumer market system is to solve the lagging issue of China’s western region market on the basis of controlling and resolving of the existing risk.

Keywords: China’s consumer market; CPI; System risk entropy; Synchronicity ratio; Stability; Market induction (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:490:y:2018:i:c:p:664-680

DOI: 10.1016/j.physa.2017.08.135

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