The Asymmetric Effects Of Monetary Policy Transmission By Credit

Long period of time, monetary policy transmission mechanism of monetary policy has been a major direction of the theory and practice research. Different schools and the actual workers made a lot of perspective and many empirical studies on the monetary policy transmission mechanism. However, because of the complexity of monetary policy transmission mechanism, and thus until now, there are still many scholars study the problem. For any country's monetary authorities, they develop practical monetary policy, and achieve the purpose of stabilizing the economy, based only on full understanding of monetary policy transmission mechanism.About the research results of monetary policy transmission channels, Mishkin (1995) had a very good overview and summarize the monetary policy in several fundamental transduction pathway, that is, the interest rate channels, the exchange rate channels, the channels or adjust the portfolio of wealth and credit channels.Before China's reform and opening-up, there are only the credit policy, basically no other monetary policy tools and complete the modern sense of the concept of monetary policy. Since reform and opening up, with the deepening of economic reform and financial market development, Instrument of monetary policy was increasingly up. However, because of capital market development at an early stage, the relationship between the virtual economy and real economy not closely enough, the role of capital market driven for investment and consumption not so obvious, so interest rates and asset prices in monetary policy transmission is in a relatively limited role. Although initially formed a multi-currency conduction channels, it is still mainly on credit channel conduction. Many domestic empirical research literatures of monetary policy transmission channels has proved this point.The last century at the end of the 30's , the outbreak of the Great Depression prompted economists begun to consider asymmetric effects of monetary policy issues, namely the effect of tight monetary policy and expansionary is asymmetry. On this basis, it has been found strong evidence of asymmetry about output transmission mechanism in the United States since World War II.Overall, Domestic research on asymmetric effects of monetary policy both at paradigm and experience is at the continuous development process. Although they have used different theoretical basis and analysis methods, but their research shows that effects of Chinese contractionary monetary policy and expansionary monetary policy existent asymmetry, as well as the existence of Chinese monetary policy regional asymmetry. At the same time, about Chinese monetary policy formation mechanism of asymmetric, it mostly concentrated on the transmission mechanism of monetary policy and on China's financial structure differences, no doubt that the practice of monetary policy for China have greater practical significance.On this basis this article attempts to explore more in-depth the following questions:(1) under the premise of that China's monetary policy transmission existence credit channels and the implementation of the process of asymmetric effects exist asymmetry,we test the asymmetry effect of monetary policy transmission credit channel.(2) Through the establishment of MSVAR model, we Study on China's credit growth rate and business cycle fluctuations in the transfer of the district system model and the district system of state, and attempt to draw useful suggestions for China's monetary policy maintain stable economic growth.(3) Through the establishment of MS-VAR model, Study on China's credit growth rate and price fluctuations in the level of the district and the district system for the transfer of model state, and Trying to come to useful suggestions for implement monetary policy to maintain price stability.Prior to conducting empirical research, we introduce the relevant theoretical models, ranging from credit pathway conduction of monetary policy research question of Bernanke-Blinder (1988) model and its development, as well as MSVAR model used in this article.Chapter III of this article we analyzed the mechanism of the asymmetry effects of monetary policy credit conduction. Sum up the principal as the following points: financial accelerator effect, the viscous economic variables, the existence of credit rationing, the subjective expectations of asymmetric adjustment, the economic structure of asymmetry.The next this paper introduced the selection of data and did some pre-processing to it. The main objectives of monetary policy are price stability and sustain economic growth. Around these two objectives we select variables can be quantified to econometric analysis. In this article we use a real growth rate of credit to express the intensity of the credit policy, and use real economic growth and inflation rate as a macroeconomic indicator. Use ADF test on the variable unit root test, the results showed the variables are existence unit root process. Next the cointegration test results show that loan growth and GDP growth or inflation are exist the long-run equilibrium relationship. By the variables describing road map, we can see that the fluctuations in the path of the variables are divided into distinct high and low phases, therefore we can consider using Markov Switching Model. In addition the loan growth and inflation with the GDP growth rate has a similar trend, indicating that there may exist relevance between them.In this paper, we simulate using OX-MSVAR at givewin2 platform.,and get the following conclusions.(1) In the course of China's economic growth cycle, there exist a significant nature of the 3 zone system, that is, "fitness-speed growth," "rapid growth" and "fast growth" phases. From the transition probability we can see that the duration of China's economic growth in the "fitness-speed growth phase" is the longest, and at the stage of greatest frequency. Fluctuations in the price level in China there are three significant areas of the nature of the system. From the transition probability we can see the stability of China's prices at "minor expansion" is strongest, and the duration is longest, the probability of economic cycle metastasis to this stage is greatest. It means that China has very strong ability to control prices, and the economy has entered a health state of proper speed of economic growth without serious inflation.(2) China's economic growth cycle fluctuations exists a certain degree of asymmetry. This is manifested in the duration of cycle, and also in different stages of transition probability. From the continuous point of view, in China's economic cycle, "fitness-speed growth phase," continues the length of the other two phases 2 times; From metastatic point of view, the transition probability from the "rapid growth" to "fitness-speed growth" is 9.1%; the transition probability from the "rapid growth" to "fast growth" is 1.4%; This shows that the current economic slowdown likely to be much greater than the possibility of accelerated economic.(3) From the direction and the extent of the impact between the credit growth and output growth, we can see, the correlation of them in the different stages of the economic cycle has changed dramatically. When the economic cycle in a "fitness-speed growth phase", the monetary policy transmission effects of the credit will lead to a decline in output growth; when the economic cycle at a "fast or high-speed growth phase", the monetary policy transmission effects of the credit will lead to the rise in the rate of economic growth. This is because of the financial accelerator effect, as well as the existence of credit rationing.From the direction and the extent of the impact between the credit rate growth and inflation rate, we can see, the correlation between them in the different stages of the economic cycle has changed dramatically. When the price level in a "deflation" period, the conduction of monetary policy effects of the credit will be positive effect to price level; when the economic cycle at a "fast or high-speed growth phase", the monetary policy transmission effects of the credit will effects the price level from the opposite direction. Therefore, in the "overheating of the economy", it can inhibit inflation, which is an important macro-control mode to promote healthy and stable economic development.