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A DSGE Model of China

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journal contribution
posted on 2022-03-01, 13:16 authored by Li Dai, Patrick Minford, Peng Zhou
We use available methods for testing macro models to evaluate a model of China over the period from Deng Xiaoping’s reforms up until the crisis period. Bayesian ranking methods are heavily influenced by controversial priors on the degree of price/wage rigidity. When the overall models are tested by Likelihood or Indirect Inference methods, the New Keynesian model is rejected in favour of one with a fair-sized competitive product market sector. This model behaves quite a lot more ‘flexibly’ than the New Keynesian


Published in

Applied Economics


Taylor & Francis


  • AM (Accepted Manuscript)


Dai, L., Minford, P. and Zhou, P. (2015) 'A DSGE Model of China', Applied Economics, 47 (59), pp. 6438-6460

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Electronic ISSN


Cardiff Met Affiliation

  • Cardiff School of Management

Cardiff Met Authors

Peng Zhou

Cardiff Met Research Centre/Group

  • Welsh Centre for Business and Management Research

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  • © The Publisher


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