ABSTRACT
This chapter predicts the cyclical fluctuation and dynamic equilibrium of China’s economic growth rate by using the model of the economic cycle. Results show that the next decade will witness a periodic deceleration in China’s economic growth, with the average growth rate falling from the eye-catching 10 percent of the past 30 years to a still-fast 6.5 percent, and its fluctuation ranging from 5 percent to 8 percent. To better face the phased transition and periodic fluctuation in the upcoming decade, we suggest that policy priority be given to subduing short-to-medium-term fluctuation and stabilizing economic growth in the short term. In the longer term the policy priority should be steadying exports, upgrading the consumption structure, promoting enterprise innovation and restructuring the economy. A virtuous circle that combines steady, rapid growth and optimized structural upgrading should be the ultimate goal of China’s economy.
