Research on the construction and weight scheme of China timber PMI

摘要

Timber Purchasing Managers' Index (PMI) has been perceived as the barometer of timber industry evolution. The weight scheme is at the core of constructing the index. In this study, an in-depth analysis on the weight scheme of Timber PMI is conducted. The empirical results reveal that the current weight does not affect the leading function of Timber PMI, but it is not the optimal weighting method. A better weighting scheme is proposed and used to improve the power for predicting industry performance.