Oil price shocks, economic policy uncertainty and industrial economic growth in China

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 Gran...

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Bibliographic Details
Published in:	PloS one 2019-05, Vol.14 (5), p.e0215397-e0215397
Main Authors:	Chen, Jingyu, Jin, Faqi, Ouyang, Guangda, Ouyang, Jian, Wen, Fenghua
Format:	Article
Language:	eng
Subjects:	Algorithms Analysis Biology and Life Sciences China Crude oil Crude oil prices Economic analysis Economic development Economic Development - legislation & jurisprudence Economic growth Economic models Economic policy Energy economics Engineering and Technology Growth Impact analysis Industrial economy Influence Macroeconomics Medicine and health sciences Models, Economic Oil People and Places Petroleum Petroleum - economics Petroleum industry Physical Sciences Prices Prices and rates Proxy Social Sciences Stock exchanges Uncertainty Volatility
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Summary:	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.
ISSN:	1932-6203 1932-6203