Macroeconomic Effects Of Exogenous Sudden Shocks

The "9.11" incident,which broke out in 2001,caused a severe blow to the American economy,World economic growth has thus fallen by one percentage point,resulting in losses of up to $350 billion.The outbreak of financial crisis in August 2007 to the United States,the euro area,many developed countries have caused serious economic recession,Chinese developing countries are also affected,Chinese sharp decline in exports,and a lot of factories.The 2008 Wenchuan earthquake caused China's direct losses to reach 845 billion 100 million yuan.Although the probability of sudden shocks,such as financial crisis,world war and natural disaster,is very small,but once it happens,it will cause great damage to the macro economy(Chen Guojin et al.,2014),Exogenous sudden shocks often lead to abnormal decline in output or capital stock in a short period of time(Barro 20052006a)and even cause market collapse(Rietz,1988).In view of the important effect of exogenous sudden impact on the macroeconomic operation,using the Markoff transfer matrix to measure the exogenous sudden impact,exogenous sudden shocks were introduced into a closed economy DSGE model and DSGE model in a small open economy with the financial accelerator,to simulate the effects of operation China macroeconomic research of unexpected shocks.Using the parameter calibration model,dynamic parameter estimation by Bayesian method,the robust test of the model to ensure the reliability of the model,the numerical simulation and the impulse response analysis of the macroeconomic effects of exogenous sudden shock and its transmission mechanism.Through the research,this paper draws the following conclusions:first,Markov transfer mechanism can depict the volatility of discrete"jump" behavior,this sudden impact on each variable impulse response is unexpected,"jumping".Second,in a closed economy,effects of exogenous sudden shocks on output,investment,consumption,capital,technology and enterprise value is the reverse,but its impact on inflation,labor and the risk premium is positive.The degree of influence from big to small is the enterprise net value,technology level,labor,inflation,investment,capital,output,external premium.Sudden shocks reduce output,consumption,investment,capital,technology,thereby weakening the ability to withstand macroeconomic risks.Third,in a small open economy,sudden impact to reduce the output,consumption,investment,capital,labor,technology and international trade,but also will improve the enterprise value and the rate of inflation,thus weakening macroeconomic risk resilience.The degree of destruction of macroeconomic variables,investment,technology and output are at the same higher order of magnitude,with the largest investment,followed by technology and output;and other macroeconomic variables are relatively low in magnitude.It leads to a series of impacts on other domestic economic variables,and also reduces the import and export trade of our country through the rapid decline of technology level.Fourth,the numerical simulation results of sudden shocks can better simulate the dynamic impact of the 2008 international financial crisis on China's macroeconomic operation.This study helps to quantify the impact of sudden shocks such as the financial crisis on China's Macroeconomic Operations and policy responses.