Nonlinear Effect Study Of Monetary Policy On Macroeconomy

Since the reform and opening up, it is China’s economy that has made remarkable achievements, and GDP remains to continue to grow rapidly. As for the emergence of this positive phenomenon, it is a result of many factors working together, including monetary policy, maybe which plays a fatal role. But the debate always lasts on the effectiveness of monetary policy in the field of macroeconomy. So far, it has not formed the uniform opinion. In this atmosphere, it is of significance to clarify the effectiveness of monetary policy.In order to theoretically prove of the monetary nature, this article makes a model of the endogenous economic growth in the framework of the endogenous growth theory and tries to introduce the parameter of money to demonstrate that the implementation of monetary policy will have a great influences on economic growth. Then, the article has an in-depth analysis to the solving result of the theoretical model by numerical simulation and finds that, in the stabilized state, there exists an inverted-U-shaped relationship between monetary supply and economic growth. Finally, in order to verify the adaptability of the consequences in the actual economy, this paper takes economic data of China as an example and makes full use of the quantile regression model to have an empirical test. Fortunately, the empirical result proves of the correctness of theoretical analysis, the adaptability in China’s actual economy and the robustness of the inverted-U-shaped. That is to say, it is not neutral or super-neutral at all on the effect of monetary policy in China. Actually, it turns out to be the inverted-U-shaped, which provides a constrained yardstick to implement monetary policy for social planners and makes them figure out that overdone is worse than undone.In the deepening process of the degree of the economic integration in the word, if the research is still confined to the domestic range, whose conclusions will certainly be challenged, so it gradually becomes a hot topic on the nature of the dependence and the impact each other in different markets, one of which is the fluctuation effect of monetary policy. In order to get a more targeted research conclusion, this article takes the United States as an example and divide it into two respective aspects:traditional monetary policy and quantitative easing monetary policy. Simultaneously, this paper has an in-depth analysis from the view of volatility effect’s existence and intensity measurement, and newly defines a dummy variable to characterize the quantitative easing monetary policy. Beside, this article constructs F-statistic to detect the influence’s existence of traditional monetary policy on China’s macroeconomy and firstly introduces upper tail dependence coefficient of Gumbel Copula to detect the impact’s existence of quantitative easing monetary policy. Finally, this paper has full use of the actual economic dates to conduct an empirical test, which proves of the reasonability of theoretical analysis and further testifies the robustness of the inverted-U-shaped.From the foregoing analysis, we can get the following conclusions that it is effective of China’s monetary policy, and it brings out the negative effect of U.S. monetary policy. Given that, to achieve stable and healthy growth of China’s economy, social planners should focus on the following three aspects that continue to expand domestic demand and optimize the economic structure to enhance the ability of resisting the impact; continue to the interval monetary policy and maintain policy continuity to boost the market confidence; continue to conduct the positive open market operation and dilute quantitative easing equelae to stabilize societal expectation.