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Causal Linkage Effect on Chinese Industries via Partial Cross Mapping Under the Background of COVID-19

Author

Listed:
  • Ding Yongmei

    (Wuhan University of Science and Technology)

  • Li Yulian

    (Wuhan University of Science and Technology
    Tarim University)

Abstract

Correctly identifying causal relations among the industries provide accurate orientation to the dynamical industry connection, which is crucial to drive the industrial structure modification and optimization for a country. Since the non-separability, causality in industrial system has different formalization, in this paper, we exploit both dynamical and statistical measures driven by industry indexes to identify direct causation from indirect ones, which the variables are non-separable, weakly or moderately interacting. Partial cross mapping is employed to eliminate indirect causal influence among the 28 industries in China, further to explore real causal links for nonlinear industrial network system. The individual, local and overall linkage effects are measured out. Data experience shows that service-oriented industries are more active than before the epidemic of COVID-19, which brings benefits to the industries of communication, bank, textile and garment. Manufacturing industry is the central node of industrial chain network, which exhibits higher and stronger motivation under the background of COVID-19, and banking sector shows a persistent and strong influence on other industries at the post-epidemic era. The hot-industrial fields were figured out, and we would expect to provide quantitative references for the flow direction of industries and decision makings.

Suggested Citation

  • Ding Yongmei & Li Yulian, 2024. "Causal Linkage Effect on Chinese Industries via Partial Cross Mapping Under the Background of COVID-19," Computational Economics, Springer;Society for Computational Economics, vol. 63(3), pages 1071-1094, March.
    • Handle: RePEc:kap:compec:v:63:y:2024:i:3:d:10.1007_s10614-023-10408-0
    DOI: 10.1007/s10614-023-10408-0
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    References listed on IDEAS

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    1. Sun, Xiaotian & Fang, Wei & Gao, Xiangyun & An, Sufang & Liu, Siyao & Wu, Tao, 2021. "Time-varying causality inference of different nickel markets based on the convergent cross mapping method," Resources Policy, Elsevier, vol. 74(C).
    2. Siyang Leng & Huanfei Ma & Jürgen Kurths & Ying-Cheng Lai & Wei Lin & Kazuyuki Aihara & Luonan Chen, 2020. "Partial cross mapping eliminates indirect causal influences," Nature Communications, Nature, vol. 11(1), pages 1-9, December.
    3. Wang, Rui & Qi, Zhongying & Shu, Yumin, 2020. "Multiple relationships between fixed-asset investment and industrial structure evolution in China–Based on Directed Acyclic Graph (DAG) analysis and VAR model," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 222-231.
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    5. Barauskaite, Kristina & Nguyen, Anh D.M., 2021. "Global intersectoral production network and aggregate fluctuations," Economic Modelling, Elsevier, vol. 102(C).
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