Research Article
Forecast and Analysis of Shanghai Consumer Price Index based on Markov chain
@INPROCEEDINGS{10.4108/eai.19-5-2023.2334393, author={Benhai Yu and Yingqiao Gao}, title={Forecast and Analysis of Shanghai Consumer Price Index based on Markov chain}, proceedings={Proceedings of the 2nd International Conference on Bigdata Blockchain and Economy Management, ICBBEM 2023, May 19--21, 2023, Hangzhou, China}, publisher={EAI}, proceedings_a={ICBBEM}, year={2023}, month={7}, keywords={consumer price index markov chain cpi currency prediction}, doi={10.4108/eai.19-5-2023.2334393} }- Benhai Yu
Yingqiao Gao
Year: 2023
Forecast and Analysis of Shanghai Consumer Price Index based on Markov chain
ICBBEM
EAI
DOI: 10.4108/eai.19-5-2023.2334393
Abstract
A macroeconomic indicator that tracks changes in the price of household purchases of goods and services is the consumer price index (CPI). In this article, a sample of the consumer price index for Shanghai from 1999 to 2020 is used. In order to calculate the comparable level of Shanghai CPI based on the relationship between the consumer price index and inflation, a Markov chain model was developed. First of all, according to the relationship between CPI and inflation, the CPI data of Shanghai is divided into four state intervals, namely: deflation, normal, inflation and severe inflation. The Markov chain model is then built using the transfer probability and frequency matrices of each state, and the model is evaluated. Finally, the prediction results of the model show that Shanghai CPI in 2021 and 2022 will be in the normal range of the currency level.