Design and Applications of Chinese Potential Output Estimation Model——An Empirical Analysis Based on Kalman Filtering

Other than traditional filtering that only decomposes the real GDP into components of trend and cycle,the dynamic multi-factors econometrics model built up in this paper.Based on conditions of Chinese socialist market economic system with the consideration of factors on international trade,monetary policy and expectations of inflation,can be used to estimate Chinese potential output,output gap,growth rate of potential output and equilibrium growth rate during year 1978 to 2009 via Kalman Filtering.The paper have discussed in the fields of the phases of business cycle,the long-term growth tendency,acceptable growth interval and economic forecast by using the above model.