The Research Of Factors On Large-scale Inflow Of Hot Money In China And The Countermeasures

Since the 1990s,A series of financial crises swept across the developing countries:1994 Mexican financial crisis,1997 Southeast Asian financial crisis,and so on.In these countries in crisis,most are in the process of capital account opening,which experienced a large-scale short-term capital inflows after the opening of capital account.These capital inflows in these countries,however,most of them did not go the real sector of the economy,but invest in the bank, securities or real estate and other industries,caused the country's economic bubble.Once the economies of these countries go through a decline,the capital will be an influx of anti-pre-start to the withdrawal,and such a large-scale capital accumulation and reversal is bound to bring great harm to the economy of these countries.Since China entered WTO organization in 2001, the Openness process of the economy has been improving,the effectiveness of capital controls has been declining in fact,a large number of international hot money started to flow into China.In order to prevent similar financial crises happening in our country,maintain our economic stability and orderly development,we must find out the real causes of hot money into China,understand the influencing factors of hot money into China,which can strengthen supervision.This article focuses on the analysis of the characteristics of hot money into China,influenced factors of hot money and the impact on some sectors.Thus can deal with the impact of hot money inflows on China,and have a great significance of reducing or avoiding the negative effects of outflow of hot money on China's macro-economic.First, this paper set the start in the theory,illustrates the meaning and characteristics of international hot money,elaborates a variety of basic theory on factors of the international capital flows on the,and with reference to internationally accepted various statistical methods estimating the scale of hot money,China uses the direct method to estimate the influx amount of hot money. Second,this article details the ways and manners of hot money into China,analyses the impact of hot money inflows on China's monetary policy,the stock market and real estate market,as well as the negative impact on China's economy when hot money withdraw.Immediately,in this paper,on the base of the factors affecting the inflow of hot money,we use the Eviews statistical software to analyse the relationship between the influencing factors of hot money inflows and the amount of hot money.Evidence is expected to come to the exchange rate is the main factor of affecting China's hot money inflows.Finally, this paper presents our policy recommendations against hot money inflows.