From the General to the Specific

J Reade and Ulrich Volz

Discussion Papers from Department of Economics, University of Birmingham

Abstract: This article uses automatic model selection procedures, based on the gernal-to-specific approach, to investigate inflation in China. A novelty of this article is the use of a technique called impulse indicator saturation which allows us to uncover instabilities and to specify a general model and select down to a more specific model that best explains inflation in China. By and large, our findings suggest that China has been able to insulate itself against shocks from the US, although (maybe surprisingly) monetary growth in Europe seems to have an effect. Nonetheless, the main factors impacting Chinese inflation appear to be domestic, names GDP growth and money growth.

Keywords: Chinese inflation; dollar peg; automatic model selection procedure (search for similar items in EconPapers)
JEL-codes: C32 E52 F33 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2011-09
New Economics Papers: this item is included in nep-cba, nep-mon and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bir:birmec:11-18

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