| In recent years, with the development of Chinese economy, foreign economic ties closer than before,the RMB exchange rate issue is increasingly being valued both at home and abroad. Some countries believethat China was suspected of manipulating its currency, while the regionalization and internationalizationprocess of RMB are also been accelerated。All these questions require a clear understanding of how theexchange rate is determined in the end, and what factors affect the fluctuations of the exchange rates. Whenthe theories and methods of exchange rate are studied by Western Economics at present, the study ofMarxist theory of exchange is a help to more comprehensive understanding for the exchange rate.Meanwhile this can provide policy recommendations for the formation of scientific mechanism of the RMBexchange rate and the regionalization and internationalization process of RMB.Marx’s theory of exchange rate was formed when the international trade of capitalism has developedand the world market has been formed, meanwhile the international gold standard has been established anda variety of currencies existed in circulation. Exchange Rate Theory plays an important role in Marx’seconomic theory system of " five plan"," six volumes plan","the capital". The theoretical basis of Marx’stheory of exchange rate is Marx’s value theory and its development in the world, namely the internationalvalue theory.In Marx’s theory of exchange rate system, fundamentally exchange rate is determined by the ratio ofthe value contained or represented by the currency. The main factors affecting the exchange ratefluctuations contain the payment balance, the interest rate, the government intervention, psychologicalexpectation factor and so on. The payment balance mainly includes the balance of trade, payment term,indirect trade, currency capital output, non-trade foreign exchange income, etc. No matter what reasonscause a temporary balance of payments is, as long as the reasons generate external cash payment, it willaffect the momentary state, and then will cause payments surplus or deficit. Surplus means in the foreignexchange market the increase in demand that buy local currency by foreign currencies, namely localcurrency is in short supply and foreign currency supply exceeds demand. That will cause the decline inforeign currency price, which means local currency appreciation and foreign currency devaluation. Similarly, deficit means in the foreign exchange market the increase in demand that buy foreign currencyby local currencies, namely local currency supply exceeds demand and foreign currency is in short supply.That will cause the rising in foreign currency price, which means local currency devaluation and foreigncurrency appreciation. The impact of exchange rate fluctuations on interest rates reflect market interestrates on the money market of a country to improve often means a shortage of monetary capital supply. Thatis likely to attract foreign investors to put money capital into the country, thus the balance of payments hasimproved in the state and prevent the country’s exchange rate from falling. Whereas the opposite. This isoften through the capital of security movement to complete. Determiner and fluctuations in exchange ratescan be summarized as follows. Exchange rate (foreign currency “price†expressed in local currency)fluctuates up and down around the ratio of the value (embodied in precious metals parity) that the twocurrencies include or represent; When foreign currency shortage, it’s prices ("price" of foreign currenciesexpressed in local currency, the exchange rate) rise; while foreign currency oversupply, it’s price("price" of foreign currencies expressed in national currency, the exchange rate) falling. Under theconditions of gold standard, the scope of exchange rate fluctuations is gold output and input point. Thehighest point of exchange rate fluctuations is precious metals parity plus shipping costs (gold output point),the lowest point of exchange rate fluctuations is precious metals parity minus shipping costs (gold inputpoints).Economic role of the exchange rate are mainly two aspects, on the one hand exchange rate is anindicator of the economic situation, and on the other hand exchange rate effects economic operation.Exchange rate affects the economy mainly reflected in the following aspects: the impact of the inflow andoutflow of precious metals, the impact of foreign trade, the impact of foreign investment, the impact ofinterest rates, and the impact of foreign exchange reserves. With the exchange rate fluctuations the gold andsilver are continued moving back and forth between different areas of the country. The devaluation of localcurrency, can attract the precious metals inflows, promote exports and reduce foreign investment, attractforeign investor investing in the country, contributing to lower interest rates on the money market,prompting an increase in foreign exchange reserves, after currency appreciation the opposite.The main exchange rate theory in western economics including theory of gold parity, theory ofinternational indebtedness, theory of purchasing power parity theory, psychological theory of exchange, theory of interest rate, the portfolio theory, theory of equilibrium exchange rate, the chaos theory ofexchange rate etc. By comparing Marx’s theory of exchange rates and Western economic theories ofexchange rates, we can find between them there are some difference in the historical background,theoretical foundation, main content and research methods. There are some factors like currencyfluctuations and analysis method worthy of learning for Marx’s theory of exchange rates. Econometricmodel is established based on Marxist theory. In the model the dependent variable is the exchange ratebetween the pound and the U.S. dollar, at the same time the explanatory variables include the ratio of themagnitude of value of the pound sterling and the U.S. dollar represented (the magnitude of value of U.S.dollar and pound sterling may be respectively represented by U.S. dollar price of gold and pound sterlingprices of gold), the U.S. trade balance, the difference between British minus American interest rates. Theeconometric model passed the inspection. On the current Marx’s theory of exchange rate plays an importantrole in terms of guiding the formation mechanism of RMB exchange rate to our country. Base on Marx’stheory of exchange rates we can put forward the corresponding policy recommendations to help activelyand steadily to push forward the internationalization of the RMB. |
