Modelling of Index System of Economic Vitality During the COVID-19 Epidemic

Authors: Jinming Cao and Bin Zhao*

Volume 5, Issue 1

Abstract

Economic vitality is an important indicator of economic development. In this paper, we have created a panel data model to analyze the influencing factors of economic vitality in China. We conducted the following studies. Using the correlation analysis, the correlation among various elements is revealed to be strong, which denies the independence null hypothesis. By establishing VAR-VEC model, the long-term and short-term effects of economic policies on economic vitality in Beijing are analyzed. It is showing that the population changes and enterprise vitality have a positive impact on economic vitality with the influencing factors being 0.01 and 0.07 respectively. At least three cointegration relationships between time series exit using the ADF unit root test and Johansen cointegration test. We use Ais-Sc Criterion to determine the order of delay as the third order and OLS estimation method to get the coefficients of VEC Model. Due to the effect of experience accumulation, the economic vitality follows a W-shaped trend. Utilizing the minimum average deviation method to preprocess the index data, 9 representative indexes are obtained. We then extract two main factors by factor analysis and build an index system of economic vitality. The economic vitality of each city from 2009 to 2020 is calculated based on this index system. Beijing, Shanghai, Guangzhou and Shenzhen often rank first, while Kunming and Dongguan often rank last. The panel data model test results are similar to that of index system on the same data. Finally, the previous conclusions have been reviewed. The ORT development strategy to improve economic vitality is advised

Keywords: Panel Data Model; VAR-VEC Model; Factor Analysis; Index System

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