BLACK SWAN EVENT: AN EVIDENCE FROM CHINA’S ECONOMICS EFECTS

Authors

  • Elena Stavrova South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria
  • Mariya Paskaleva South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria
  • Ani Stoykova South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria

DOI:

https://doi.org/10.12955/peb.v1.30

Keywords:

Black Swan crisis and China's economy, macroeconomic indicators, stock market index, correlation

Abstract

The prognosis of upcoming crises and the course of actually understanding them is increasingly becoming a major subject of discussions in pursuit of reliable indicators. The trade war between the United States and China, along with the COVID-19 pandemic are two events that took place in the Chinese economy with the aforementioned characteristics of the Black swan phenomenon, to which this latest professional analysis is devoted. The objective of this research is to examine the response of the Shanghai Stock Exchange Composite (SSEC) index, in addition to its relation with macroeconomic variables contributing towards a possible Black Swan Event. We employ an econometric methodology comprising of a unit root test, descriptive statistics, linear regression and correlation analysis for the period 2007-2019. Our results illustarte that the bubble from 2015, which is classified as a Black Swan event by many researchers, has a negative influence on the SSEC index. We can further deduce that there were some psychological effects on the Chinese stock market that lead to both, positive and negative trends of SSEC indices. The main findings confirmed that the Consumer Price Index, Exchange Rate, Interest Rate, Unemployment, GDP and Trade Balance were significantly elaborative macroeconomic variables, that had a substantial impact on the SSEC index.

Author Biographies

Elena Stavrova, South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria

South-West University “Neofit Rilski”-Blagoevgrad, Blagoevgrad, Bulgaria

Mariya Paskaleva, South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria

South-West University “Neofit Rilski”-Blagoevgrad, Blagoevgrad, Bulgaria

Ani Stoykova, South-West University “Neofit Rilski”-Blagoevgrad, Bulgaria

South-West University “Neofit Rilski”-Blagoevgrad, Blagoevgrad, Bulgaria

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Published

2020-11-16

How to Cite

Stavrova, E. ., Paskaleva, M. ., & Stoykova, A. . (2020). BLACK SWAN EVENT: AN EVIDENCE FROM CHINA’S ECONOMICS EFECTS . Proceedings of CBU in Economics and Business, 1, 133-140. https://doi.org/10.12955/peb.v1.30