Abstract

Fluctuations in the business cycle are always ups and downs, and the lose of social welfare is beyond doubt, which led to explore the characteristics of the business cycle to obtain the regularity of fluctuations in the business cycle evidence. Firstly, this article analysis the characteristics and causes of the fluctuations in business cycle, then, explore an important dynamic characteristics of the volatility in business cycle-asymmetry-in concrete to the identification and countermeasure analysis of the volatility in business cycle fluctuations.

Business cycle short-term fluctuations in the economy appears to be the deviation from the equilibrium state, such a departure from the repeated cyclical in business cycle reflects some sort of systematic and relevance of the movement. Volatility in the business cycle at different stages of economic operations reflects different conditions, is not the simple repeat of past cycles. It is different in the amplitude, the scope and duration in different stage of business cycles, and current global economic trends performance is microwave in the overall economic operation, the characteristics of the performance in China is high economic slowdown and we call it as “high moderate smoothing”.

In this paper, the drive factor in accordance with China’s business cycle will be divided into “single-factor-driven stage of the supply,” “two-factor-driven stage of the supply and demand” and “the demand for single-factor-driven stage” three-stage. According to this, we analysis patterns and causes of the volatility during the three recent business cycle in China, and found out that a new round of business cycle in China may be beginning in 2008. But the economy will still maintain the basic structure and long-wave situation, and still be in the stability of macro-control to maintain appropriate speed, continuous and steady growth. The first round of the main long-wave-based location China's growth since the founding will revolve around the “natural growth” and continue to extend the level of the business cycle, then it will be the model with the stability of the three cycle mode reincarnation and options.

Asymmetry in business cycle volatility related to macroeconomic policies in the business cycle at different stages and had a significant impact in the actual operation of economic life. If the business cycle is symmetry, then the business cycle from the expansion can be compared the contraction of the business cycle, then we can infer the nature of business cycle from peak to the bottom. The symmetry of the business cycle means that the symmetry of the role of economic policy, and can control the direction of economic operation accord with the stages in business cycle and reflect the symmetric characteristics of the main macroeconomic variable time series in the business cycle.

In this paper, we adopted a qualitative and quantitative analysis and combination of static analysis and dynamic analysis to analysis of business cycles volatility and asymmetry in business cycle volatility. The analysis transition from theory to empirical testing, and then provides countermeasures and proposals to the final cause and further analysis. Qualitative analysis on the volatility in the business cycle and asymmetry mainly based on the systematic analysis of the status quo, in accordance with the actual situation of the asymmetry type in China’s business cycle, then summing up and analysis the impact of social and welfare. Specifically, in the business cycle volatility analysis, we using the rolling method; for analysis of the asymmetry in business cycle, the main measures taken by are “triple” test, time deformation model, and unobserved method. The theory of methods introduced in Chapter III, and then we use the three methods testing of asymmetry on China's business cycle in Chapter IV. The results show that there is a certain degree of asymmetry in China's business cycle, whether it is rate or persistent, the expansion stage in China’s economic actual output sequences were higher than the tightening process, which is accord with a classic dissertation in business cycle volatility: “the term of expansion is longer than the contraction, the scope of contraction was significantly lower than expansion in business cycle,” which means that the current round of high business cycle will be formed at the bottom and have a tendency to drag, and the appearance of asymmetry in business cycle relevant with the learning process, through learning process. We can understand the causes of asymmetry in business cycle volatility more profoundly.

Finally, we carried out simple analysis of the causes of asymmetric in, the business cycle volatility. The asymmetric information at different stages and the likeness of good news cause the asymmetry in the business cycle volatility. In this paper, a more desirable approach solve the asymmetric in the business cycle volatility is the learning process of asymmetry in the business cycle volatility, the learning process is mainly embodied in the awareness of asymmetry in business cycle. If we understanding of economic asymmetric cycle, the information of business cycle asymmetry can be given further excavation, then, the use of already existing information and continuous learning process will become more perfect, we will use all means to avoid such asymmetry of the business cycle volatility.

In sum, The test results show a certain degree of asymmetry in China’s business cycle，but the tendency of business cycle volatility is become stability, stage of the business cycle has become increasingly blurred, but the business cycle would be exist and will not disappear, volatility of the business cycle will be getting smaller and smaller. The asymmetry of business cycle volatility will also continue to exist, but the disadvantage effects would be further weakened as people to strengthen the learning process, and then the asymmetry in business cycle volatility would not so obviously.

Key words

Business Cycle; Business Cycle Volatility; Asymmetry

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