How Does Keqiang Index Work for the Economy of China? Open Access

Diao, Yijue (2016)

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How to keep track of Chinese economy? I address this question by comparing Keqiang Index with GDP and analyzing movements of different components from 2000 to 2014. I find that Keqiang Index is more consistent with GDP in areas which second industry has a heavier share among all economics activities. I also consider that the indicator, Loan Disbursed by Bank, will distort Keqiang Index and generate gaps between Keqiang Index and GDP. I find that cargo volume by rail is not representative enough for every region, for example, Tianjin and Sichuan. I also notice that the volatility of Keqiang Index is much larger than GDP, by comparing the standard deviation of each.

Table of Contents

I. Introduction. 1

II. Literature Review. 3

III. Data and Methodology. 5

IV. Sample Results of Keqiang Index. 6

V. Findings on Aggregate Level. 10

VI. Other Findings. 14

VII. Conclusion and Further Steps. 15

VIII. Work Cited. 17

IX. Appendix. 18

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