Evaluation of US and China's post-pandemic recovery

Abstract

We focus on the relationship between inflation and unemployment in the United States and China, the two biggest economic systems in the world before and after the COVID-19 pandemic. We used a comprehensive monthly dataset of two countries Consumer Price Index (CPI), unemployment rate, and interest rate from 2019 to 2022 and performed time series regressions to analyze the relations among these variables. We found strikingly different paths for the two countries, with the US path closely matching conventional economic theory, while Chinas deviated significantly.