Research On The Cyclic Fluctuation And Influencing Factors Of Forestry Economy In China

Nowadays, with the implementation of a series of policies which responses to the environmental crisis in 1998 and financial crisis in 2008, forestry sector has been becoming one of the newest drivers of Chinese economy. The output value of forest has grown at an annual growth rate at 20.95% during 1998 to 2013, which is the solid foundation of the development of gross domestic product. Meanwhile, the ecological benefit of forest has considered as an imperative issue since the 1998 Yangtze River floods. And a series of remarkable achievements of Chinese forestry has been made from 1998 to 2012, including starting China six vital forestry projects in 1998, implementing collective forest tenure reform from 2003 and building ecological civilization centered on forestry from 2012. However, with the ecological benefit of forest be paid greater attention, the output value of forest has been deeply influenced as well. This creates the need to analyze the regular pattern and characteristics of forest economic and related influencing factors in recent years, which is benefit to make reasonable evaluations of forestry policy and set proper objectives and model of forestry economic development.In this paper, we carefully consider the issue about the characteristics of fluctuation of output value of forestry, examining the regular patterns and potential links of sectorial shocks and aggregate fluctuations. For the sake of aiding the policy design and implementation, this research focuses on China from 1998 to 2013 in a hope to provide more definitive evidence of fluctuation of the output value of forestry under the new background of forestry reform and ecological civilization building. Firstly, business cycles are used to analyze short-run behaviors and long-run behaviors of forestry economy during the expansions and contractions. Secondly, liner regression, Solow Growth Model and Granger Causality Test are used to analyze potential influencing factors and the relationship between the fluctuation of GDP and the fluctuation of the output value of forestry. Last but not the least, ARIMA Model is used to forecast the fluctuating tendency of the output value of forestry. Empirical evidence reveals there are four cycles which is associated with the average wave length up to 3 years regarding to short-run analysis of forestry fluctuation. And two long-term fluctuation of forestry economy, which is associated with Juglar cycle, can be recognized based on Chow test. Besides, it is shown that the influencing factors including forestry industrial structure, the supply of labor, capital and technology, the financial investment and the implementation of ecological construction are significantly influenced the fluctuation of forest. More specifically, there are time lag between the fluctuation of GDP and the fluctuation of the output value of forestry.With the purpose of promoting the growth of output value of forestry and GDP, the suggestions are as follows: firstly, forestry industrial structure, administrative system and the distribution of forestry industry throughout the whole country should be carefully adjusted. Secondly, ecotourism and the under forestry economy should be encouraged to develop the multiple benefits of forest. Thirdly, Chinese government needs to be extra careful in improving the contribution rate of Technology.