By tradition, hosting the Olympics is fantastic for a country's international standing – it generates an economic boom from construction and euphoric consumption. But it is soon followed by a nasty economic hangover.

Since the mid-1950s Morgan Stanley economists estimate that gross domestic product in Olympic hosts has fallen on average by 4 percentage points from the year before the games to the year after. Something similar is just what China needs to slow its galloping economy and what the authorities are trying to engineer after the success of the Beijing Olympics.

It is too early to tell whether the Chinese economy will slow as desired, whether the slowdown will go too far and threaten social stability in a country that needs to grow fast to absorb surplus labour and spread the rise in prosperity inland, whether inflation will again rear its ugly head after falling sharply this autumn, or whether China might even suffer stagflation.