数量经济与金融系列讲座第360期：Fluctuating Like China: Business Cycle during Structural Change

题目：Fluctuating Like China: Business Cycle during Structural Change

嘉宾：赵波

Abstract: Business cycle fluctuations in countries undergoing structural transformation differ systematically from business cycles in industrialized countries: we document that countries with large declining agricultural sectors -- including China -- have aggregate employment fluctuations that are smooth and acyclical, while these countries experience volatile and procyclical reallocation of labor between agriculture and non-agriculture. We provide an unified theoretical framework for studying business cycle during structural change. The central aspect of the theory is the modernization of agriculture that occurs during the structural change: agriculture is becoming increasingly capital intensive and less labor intensive as a large traditional sector is crowded out. With a large traditional sector the expansion of manufacturing draws workers from traditional agriculture, ensuring smooth aggregate employment and large reallocation of workers between sectors. This process is driven by capital accumulation and differential productivity growth between agriculture and non-agriculture. We calibrate the model to China and show that the model is consistent both with China's structural transformation and with the business cycle properties of China. Moreover, the model is consistent with the the changing business cycle properties as the economy goes from a poor economy with a large agricultural sector to a modern industrialized economy with negligible agricultural employment.