Open AccessOil price shocks, economic policy uncertainty and industrial economic growth in China
Author(s) -
Jingyu Chen,
Faqi Jin,
Guangda Ouyang,
Jian Ouyang,
Fenghua Wen
Publication year - 2019
Publication title -
plos one
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.99
H-Index - 332
ISSN - 1932-6203
DOI - 10.1371/journal.pone.0215397
Subject(s) - granger causality , economics , china , oil price , vector autoregression , econometrics , causality (physics) , macroeconomics , monetary economics , geography , physics , archaeology , quantum mechanics
This paper combines a Granger causality test and a VAR model to investigate the relationships among oil price shocks, global economic policy uncertainty (GEPU), and China’s industrial economic growth. Based on monthly data from 2000 to 2017, we reveal that GEPU and world oil prices jointly Granger cause China's industrial economic growth; world oil prices have a positive effect on China's industrial economic growth, while GEPU has a negative effect. Further analyses investigate the asymmetry effect of oil prices and find that the negative component shows a more significant impact on China's industrial economic growth. The results are robust to different oil price and EPU proxies.