Economic output and social stock of steel: Evidence from dynamic material flow analysis and statistical time series analysis

The relationship between economic output and social stock of steel is studied using dynamic material flow analysis (MFA) and statistical time series analysis for the period of 1949 to 2012 on Chinese national level. The results show that social stock of steel increases as the economy develops, and the speed of growth increases gradually. There is stable equilibrium relationship between economic output and social stock of steel in the long run. GDP is affected by net additions to stock (NAS) both in the short term and in the long run according to the results of Granger causality test based on vector error correction model (VECM), however, GDP is only the long-term Granger cause of NAS. The results indicate that economic development is highly dependent on the use of steel, and the demand of steel is affected by GDP in a long term process, but not in the short term.