COVID-19's Impact on China's Economy Based on Data of Spring Festival Travel Rush

14 Pages Posted: 17 Mar 2020

See all articles by Yunhao Wang

Yunhao Wang

Northeast Normal University

Zhiqiang Fang

University of Melbourne

Wei Gao

Northeast Normal University

Date Written: March 15, 2020

Abstract

The outbreak of COVID-19 in China during the Spring Festival of 2020 is an unprecedented event. Its impact has spread throughout the country and around the world. In order to explore the impact of the epidemic on China's economy, this paper starts with the analysis of the daily railway passenger volume data during the Spring Festival travel rush, and establishes three time series to model the railway passenger volume, GDP in the first quarter model, and GDP in the last three quarters respectively. The forecast results indicate that: (a) Affected by the epidemic, China’s economy will lose 4.8 trillion yuan in the first quarter of 2020, which is an expected decrease of 20.69% and a year-on-year drop of 15.60%; (b) China's expected GDP growth rate for the full year of 2020 will reduce from 6.50% to 1.72%. However, there are some positive factors not taken into account in these models, which means that the forecast results may be underestimated. With the global spread of the epidemic, the instability of the world economy will in turn impact China’s economy. In this regard, the Chinese government should adopt a policy of focusing on both domestic and external affairs.

Keywords: COVID-19, China’s GDP prediction, Spring Festival travel rush, Transportation data, RegARMA model

JEL Classification: C0, C1, C5, I1

Suggested Citation

Wang, Yunhao and Fang, Zhiqiang and Gao, Wei, COVID-19's Impact on China's Economy Based on Data of Spring Festival Travel Rush (March 15, 2020). Available at SSRN: https://ssrn.com/abstract=3554638 or http://dx.doi.org/10.2139/ssrn.3554638

Yunhao Wang (Contact Author)

Northeast Normal University ( email )

Changchun
China

Zhiqiang Fang

University of Melbourne ( email )

185 Pelham Street
Carlton, Victoria 3053
Australia

Wei Gao

Northeast Normal University ( email )

Changchun
China

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