EMD-Based Study of the Volatility Mechanism in Economic Growth
Tinghui Li 1
Zhehao Huang 2  
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School of Economics and Statistics, Guangzhou University, Guangzhou, CHINA
Guangzhou International Institute of Finance and Guangzhou University, CHINA
Online publish date: 2017-11-24
Publish date: 2017-11-24
EURASIA J. Math., Sci Tech. Ed 2017;13(12):8121–8130
This article belongs to the special issue "Problems of Application Analysis in Knowledge Management and Science-Mathematics-Education".
In this paper, Empirical Mode Decomposition (EMD) is used for decomposing the quarterly data of year-on-year GDP growth rate from 2000 to 2016. Four intrinsic modes of different frequency scales and inclusive of economic growth volatility are obtained, together with one smooth residual term. Based on the validity information of the decomposed waveforms, the statistical method and the economic significance information are identified for exploring the inherent law of economic growth, before concluding that the economic growth volatility mechanism is comprised of the short-, medium- and long-term influential factors and a relatively stable basic element. Empirical analysis has found that the impacts of long-term volatility factors are dominant and tend to be determined by the business cycle.
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