Table 11.

Variance decompositions

Period	Taiwan		China
	% of the forecast-error variance of ΔLIP explained by changes in log(VWTI)	% of the forecast-error variance of ΔLGDP explained by changes in log(VWTI)	% of the forecast-error variance of ΔLIP explained by changes in log(VWTI_SHSZ)	% of the forecast-error variance of ΔLGDP explained by changes in log(VWTI_SHSZ)
Panel A
1	0.00	0.00	0.00	0.00
2	1.16	0.25	0.47	0.03
5	3.49	0.54	0.80	3.26
10	3.52	0.58	0.81	3.32
12	3.52	0.58	0.81	3.33
20	3.52	0.58	0.81	3.33

	Taiwan		China
	% of the forecast-error variance of changes in log(VWTI) explained by ΔLIP	% of the forecast-error variance of changes in log(VWTI) explained by ΔLGDP	% of the forecast-error variance of changes in log(VWTI_SHSZ) explained by ΔLIP	% of the forecast-error variance of changes in log(VWTI_SHSZ) explained by ΔLGDP
Panel B
1	0.02	14.30	2.26	30.19
2	0.26	18.62	2.40	31.34
5	0.42	27.33	3.65	39.34
10	0.43	30.00	3.70	39.56
12	0.43	30.29	3.70	39.57
20	0.43	30.40	3.70	39.57