Empirical Analysis Of Regional Asymmetric Effect Of Monetary Policy In China

Regional asymmetric effects of monetary policy has been a hot research in the effectiveness of monetary policy. Monetary policy is an important macroeconomic regulation method, by which the macro-economy operation is regulated on the total amount. The central bank formula and implement the unified monetary policy based on the operation of the macro-economy as a whole. The unified control is premise with the homogeneity of regional economic development. With the unbalanced regional economic development, asymmetric regional effect of monetary policy arose that will lower the overall effect of monetary policy. It is necessary to study on the existence, the measurement and the origin of asymmetric regional effect of monetary policy in China.This article is based on the theoretical basis of monetary policy analysis, an attempt to study the macro-control capacity of China’s monetary policy from the point of view of the source of asymmetric shocks in the unified monetary policy. Taking quarterly data of2005.02-2012.11of the eight region as sample, the asymmetric regional effect of monetary policy in China is test again by stability test, VAR model, Impulse Response Function, which is basically consistent to the earlier one. At the same time, it reveals the deep-seated contradictions of the implementation of a unified monetary policy and regional economic and financial development heterogeneity.In view of that, in order to diminish the asymmetry of regional effect of monetary policy in China some corresponding suggestions are put forward. Regional difference should be taken into consideration when monetary policy is designed and implemented. With the coordination of monetary policy, fiscal policy, industry policy, foreign trade policy and income distribution policy, China will be established to be an optimum currency area.