There are two dimensions for understanding business cycle：one is clarifying facts，and another is constructing theory. Economics is a western learning. Modern free market economy has originated and matured in western world，along with the initiation and development of business cycle theory. China’s economy has experienced an unprecedented rapid growth after the reform and open-up，while the feature of its business cycle fluctuations has also changed evidently. How to clarify and explain China’s business cycle facts and even to enrich and develop western theory following the tradition and framework of western business cycle theory？ This is the theme this book tries to discuss.

In western world，the history of business cycle theory lasts at least two hundred years，which includes three times of paradigm shifting. The first time is preliminary mathematization and formalization；the second one is the large scale macroeconomic econometric model；and the last one is the DSGE framework which was evolved from the RBC theory. After the global financial crisis in 2008，the mainstream macroeconomics has been rethought and criticized continually，and the DSGE framework has been the first to bear the brunt of it. The so called Great Recession may prepare the condition for new macroeconomic paradigm，just like the Great Depression bringing the Keynesianism and the Stagflation helping the New Classical Macroeconomics.

The facts of business cycle can be studied by two ways. One is economic history，another is time series analysis. We call the former descriptive facts，and the latter stylized facts. The descriptive facts mostly describe the business cycle phenomenon in language. Their conclusion is qualitative and based on the events and details which had really happened，although data are quoted sometimes. The stylized facts are the empirical laws which are found by transforming and comparing macroeconomic time series. Their conclusion is quantitative and paying more attention to the uniform characters of business cycle in long run.

From the point of view of the descriptive facts，China’s business cycle can be divided into a few obvious stages，and each stage has its sharp-cut peculiarity. There are two good reasons why this condition exists. First，China’s economy had been a closed and agricultural economy when the PRC was founded in 1949. Modernization and industrialization are two long-range goals，and then the different stage of economic development results in the different feature of business cycle. Second，after the foundation of the PRC，the centralized planned economic system was established rapidly，which was based on unitary public ownership. Some modifications and reforms have been carried on continuously because the disadvantage of this system appeared soon. After the market-oriented economic reform started in 1978，the economic structure and operation had changed hugely. Therefore the stage of institutional change shaped the stage of business cycle.

From the point of view of the stylized facts，the behavior of Chinese macroeconomic time series is very different between pre and post reform and open-up. We summarize thirteen important changes in all. Most of them exhibit the promotion of the degrees of marketization，monetization and industrialization of our national economy，which is consistent with the economics common sense and intuition. For example，the change of real economy and price’s amplitudes，the changes of the fiscal revenue and expenditure’s business cycle features，the changes of the money supply’s business cycle features and the change of the co-movement with UK and US etc. Furthermore，these changes are all correlated with economic development and institutional change. On the contrary，some changes seem to be relatively erratic and abnormal. For example，the changes of price and inflation’s business cycle features，the change of aggregate employment’s business cycle features and the change of real interest rate’s business cycle features etc. It is not so easy to explain such changes in general economic theories simply，and some profounder and more prudent research must be carried on.

There are two dimensions for understanding business cycle：one is clarifying facts，and another is constructing theory. Economics is a western learning. Modern free market economy has originated and matured in western world，along with the initiation and development of business cycle theory. China’s economy has experienced an unprecedented rapid growth after the reform and open-up，while the feature of its business cycle fluctuations has also changed evidently. How to clarify and explain China’s business cycle facts and even to enrich and develop western theory following the tradition and framework of western business cycle theory？ This is the theme this book tries to discuss. In western world，the history of business cycle theory lasts at least two hundred years，which includes three times of paradigm shifting. The first time is preliminary mathematization and formalization； the second one is the large scale macroeconomic econometric model； and the last one is the DSGE framework which was evolved from the RBC theory. After the global financial crisis in 2008，the mainstream macroeconomics has been rethought and criticized continually，and the DSGE framework has been the first to bear the brunt of it. The so called Great Recession may prepare the condition for new macroeconomic paradigm，just like the Great Depression bringing the Keynesianism and the Stagflation helping the New Classical Macroeconomics.The facts of business cycle can be studied by two ways. One is economic history，another is time series analysis. We call the former descriptive facts，and the latter stylized facts. The descriptive facts mostly describe the business cycle phenomenon in language. Their conclusion is qualitative and based on the events and details which had really happened，although data are quoted sometimes. The stylized facts are the empirical laws which are found by transforming and comparing macroeconomic time series. Their conclusion is quantitative and paying more attention to the uniform characters of business cycle in long run. From the point of view of the descriptive facts，China’s business cycle can be divided into a few obvious stages，and each stage has its sharp-cut peculiarity. There are two good reasons why this condition exists. First，China’s economy had been a closed and agricultural economy when the PRC was founded in 1949. Modernization and industrialization are two long-range goals，and then the different stage of economic development results in the different feature of business cycle. Second，after the foundation of the PRC，the centralized planned economic system was established rapidly，which was based on unitary public ownership. Some modifications and reforms have been carried on continuously because the disadvantage of this system appeared soon. After the market-oriented economic reform started in 1978，the economic structure and operation had changed hugely. Therefore the stage of institutional change shaped the stage of business cycle. From the point of view of the stylized facts，the behavior of Chinese macroeconomic time series is very different between pre and post reform and open-up. We summarize thirteen important changes in all. Most of them exhibit the promotion of the degrees of marketization，monetization and industrialization of our national economy，which is consistent with the economics common sense and intuition . For example，the change of real economy and price’s amplitudes，the changes of the fiscal revenue and expenditure’s business cycle features，the changes of the money supply’s business cycle features and the change of the co-movement with UK and US etc. Furthermore，these changes are all correlated with economic development and institutional change. On the contrary，some changes seem to be relatively erratic and abnormal. For example，the changes of price and inflation’s business cycle features，the change of aggregate employment’s business cycle features and the change of real interest rate’s business cycle features etc. It is not so easy to explain such changes in general economic theories simply，and some profounder and more prudent research must be carried on.（AI翻译）