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CHINA'S ECONOMIC GROWTH: WHAT DO WE LEARN FROM MULTIPLE‐BREAK UNIT ROOT TESTS?
Author(s) -
Li XiaoMing
Publication year - 2005
Publication title -
scottish journal of political economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.4
H-Index - 46
eISSN - 1467-9485
pISSN - 0036-9292
DOI - 10.1111/j.0036-9292.2005.00344.x
Subject(s) - unit root , economics , endogenous growth theory , china , unit root test , unit (ring theory) , chinese economy , structural break , institution , macroeconomics , econometrics , growth rate , root (linguistics) , growth theory , keynesian economics , economic growth , mathematics , cointegration , human capital , linguistics , philosophy , mathematics education , political science , law , geometry
This paper investigates China's economic growth by performing multiple‐break unit root tests on the data of national and sectoral output and output per worker to identify their steady‐state and transitional growth paths. The evidence generated suggests that the growth behaviour of the Chinese economy is consistent with endogenous growth theory. The results of multiple‐break unit root tests are then explained within the endogenous growth framework, using historical observations on how the evolution of economic institution/environment causes changes in some institutional parameters and hence in the steady‐state growth rate of GDP per worker.