The Dynamic Analysis Of The Causes Of Inflation, Before And After The Financial Crisis

Research and analysis of the inflation has traditionally been the most importa nt economic research and the most popular field, and the related academic papers h ave been published all the time. Because of the influencing factors of inflation is c omplicated, and along with the progress of the era of economic development, the f actors that affect inflation continues to increase, make the study more and more dif ficult, more and more complicated. As a large number of different disciplines scho lar’s research, new tool new method was introduced, research method is becoming more and more diverse. Controlling inflation is the most important one of the goals of the macroeconomic regulation in our country. Recent years, China has experien ced. alternate inflation and deflation. Natural disasters, national policy, foreign trad e and the impact of the external crisis of our country has a significant impact on inf lation. With the2008financial crisis as a node, this article in January2005-Dece mber2013was divided into two periods. The main purpose is to analysis before an d after the financial crisis, the important changes in the macroeconomic aspects of the cases, observation affect inflation factors and their impact on inflation of chang es have taken place. Verify the effect of inflation theory’s explanation affect to Chi na’s practical problems. Provide national macroeconomic regulation and control to a better reference.In this paper the writer chooses the authority definition of the new Palgrave e conomics dictionary about inflation:a period that the general process of continuou s comprehensive price increases. About the cause of inflation, many factors affect i nflation in this paper. The writer discusses the cause of inflation roughly in the foll owing aspect:the money factor, demand factor, cost factors, structure, other factor s such as inflation expectations. In this article CPI is chosen to be the measure of i nflation, VAR model is the econometric empirical model.The results of three econometric models, integrated in the data of108months, from January2005to December2013, are as follows: Much affected by inflation expectations of inflation in China, the three models according to the current inflation is significantly affected by the lag period of inflation.The broad money supply M2growth on the whole, and before the financial crisis impact on the CPI is not large. But after the financial crisis of the model shows that the post-crisis era rising inflation in China is mainly due to the currency issue. After the financial crisis, China’s loose monetary policy is to stimulate the economy, out of the crisis, has made the excess liquidity. In addition, it also suggests that the current macroeconomic situation, the cause of the CPI changes very frequently, the influence factors of it are rapidly changing. Our economic policy must be timely correct change, otherwise it will cause trouble.The output gap, overall inflation in China is not always caused by excess demand inflation. Investment and exports are the main drivers of economic development in China, excessive investment and foreign is also considered a major cause of inflation. In this paper, the analysis found a surplus of aggregate demand is not the situation in our country, but that doesn’t mean no excessive investment and wasteful investment in our country.The purchasing prices of raw materials of fuel power index PP1RM. Unlike subjective feelings, such as price of raw materials of fuel power rise is mainly negative impact on the CPI.Employment (town) represents the average wage level of our country’s wages. Nearly nine years in spite of the financial crisis in our country, but the overall is still a stage of rapid development. It is not difficult to understand the rapid rise in wages must cause the overall price rise. But the feelings of ordinary residents only prices rise, income growth was average. The current income gap enlargement is the huge problems facing the Chinese economy. High income industry high income people raise the speed of the rise in the overall income, but part of a larger group did not experience the increase of income, so they are more sensitive to rising prices.Based on the empirical results the writer puts forward policy Suggestions. Fir st, measures and statistical methods should be standardized, to enrich and optimize the composition of China’s consumer price index, adapt to our country economy d evelopment and the change of people’s consumption structure and improve the scie ntific and accuracy of the CPI. Secondly, lead people to form scientific inflation ex pectations, control inflation inertia effects, to strengthen the study of economics kn owledge propaganda and popularization. Thirdly, implement cautious and stable m onetary policy, optimize our country’s monetary policy tools, monetary regulation from direct control to gradually reduced to indirect regulation, and gradually reduc e the dependence on the use of the deposit reserve rate, make the open market oper ations as the main tool of monetary policy. Fourthly, adjust and optimize industrial structure. Fifthly, fade out of price controls and maintain the openness of market e conomy. Last but not the least, optimize the distribution system, narrow the gap be tween rich and poor, improve the social welfare system.