Study Of The Monetary Policy Regional Effects Under The Difference Of Regional Finance

Since 1984, after the commercial banking functions being removed from the People's Bank of China, it had become a specialized central bank; the monetary policy it implemented has gradually become an important part of China's micro-control systerm. In the practice of monetary policy in resent years, monetary policy control means have changed from direct control to indirect control; the implementation of monetary policies has played an important role in maintaining price stability and promoting economic growth. However, in China, regional economic and financial development has great difference in the size, structure, efficiency, and the degree of market and openness are all different. The impact of monetary policy will be different when it is being affected by various difference factors in the conduction process; we call this the regional effects of monetary policy. It will weaken the effects of monetary policy and exacerbate uneven regional development.In the most study, China has been divided into four areas: east, middle, west and northeast, they discussed and suggested carrying out differentiated monetary policy by this region division method. But, there were little attention on this. Whether the regional effects of monetary policy exist in a smaller area? If the answer is definite, this kind of division means needs is not reasonable. Based on this, this paper choose six provinces of central China as study area to confirm the existence of regional effects of monetary policy in this area.Firstly, the writer reviews the theory of monetary policy, relater research at home and abroad, practice of monetary policies and tools and describes the difference of economics and financial development in this area. Then, the writer chooses appropriated variables and uses VAR model, impulse response, variance decomposition to empirically analysis the regional effects of monetary policy, and gets several results:(1) there exists regional effects both in the internal conductivity and the external conductivity in the six provinces.(2) Interest rate transmission channel is not smooth in China, credit transmission is still the main conduct channel.(3) Regional economics is endogenous, monetary policies can't greatly affect the regional economics.