Efficiency wedge drives Chinese economic fluctuations, shaping future research directions.
The study looked at what caused economic ups and downs in China from 1978 to 2006. They found that changes in institutions and technology were the main reasons for these fluctuations. After 1992, problems in the capital market also started affecting the economy. Government spending and exports didn't have as big of an impact on the economy's ups and downs. The findings suggest that more research is needed to understand China's business cycles better.