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Lessons from studying a simple macroeconomic model for China

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  • Chow, Gregory C.

Abstract

Updating (Chow, 1985) and (Chow, 2010), this note finds that (1) the consumption equation continues to hold but the investment equation fails; (2) the investment equation holds if investment data for 2008 and 2009 are revised downward to reflect government expenditures as a part of the stimulus package during the world economic downturn; (3) small errors in one or two observations can reverse the sign of a significant regression coefficient in econometric practice.

Suggested Citation

  • Chow, Gregory C., 2011. "Lessons from studying a simple macroeconomic model for China," Economics Letters, Elsevier, vol. 112(3), pages 233-235, September.
    • Handle: RePEc:eee:ecolet:v:112:y:2011:i:3:p:233-235
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    References listed on IDEAS

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    1. Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-987, December.
    2. Chow, Gregory C., 2010. "Note on a model of Chinese national income determination," Economics Letters, Elsevier, vol. 106(3), pages 195-196, March.
    3. Chow, Gregory C, 1985. "A Model of Chinese National Income Determination," Journal of Political Economy, University of Chicago Press, vol. 93(4), pages 782-792, August.
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    Cited by:

    1. Liping Gao And Hyeongwoo Kim, 2016. "Testing The Predictability Of Consumption Growth: Evidence From China," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 41(3), pages 21-30, September.
    2. Gregory C. Chow, 2011. "A Model for National Income Determination in Taiwan," Working Papers 1335, Princeton University, Department of Economics, Center for Economic Policy Studies..
    3. Le, Vo Phuong Mai & Matthews, Kent & Meenagh, David & Minford, Patrick & Xiao, Zhiguo, 2015. "China s financial crisis the role of banks and monetary policy," Cardiff Economics Working Papers E2015/1, Cardiff University, Cardiff Business School, Economics Section.
    4. Gregory C. Chow, 2011. "A Model for National Income Determination in Taiwan," Working Papers 1335, Princeton University, Department of Economics, Center for Economic Policy Studies..
    5. Chow, Gregory C, 2016. "Important laws governing China's macro-economy," Journal of Comparative Economics, Elsevier, vol. 44(2), pages 289-294.

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