Research On Regional Differences Of Monetary Policy Effects

The imbalance of regional development is a prominent problem in the current Chinese macroeconomy,and monetary authorities have relied on two major macroeconomic control measures,monetary policy and fiscal policy to achieve economic development.With the reform of the economic system,monetary policy has gradually become the main means of regulating the economy,and its impact on economic development is growing.Over the years,in order to achieve macroeconomic goals,a unified monetary policy has been implemented to maintain a steady and sustained growth for the whole national economy,focusing on the overall economic development,and not taking into account the development of numerous economic differences among different regions and not taking targeted measures to adjust the monetary policy.It will inevitably lead to regional economic differences and make the regional differences expand.It will not only hinder the development of China's overall economy,but also undermine the stability of the overall economy,affecting the normal life of the people.The goal of monetary policy is not only to stabilize the national macroeconomy,but also to promote the coordinated development of regional economy.Therefore,it is necessary to study the existence and the effect of regional differences in monetary policy effect on the economic development of different regions.In this paper,first,through the domestic and foreign literature on the study of regional differences in monetary policy,summed up the study of this issue from many aspects.Then through the effectiveness of monetary policy,the optimal currency area theory and transmission mechanism of monetary policy of three aspects for the initial theoretical analysis,and then through the construction of linear SVAR model and nonlinear MS-VAR model for empirical analysis,using interrelated quarterly data in 1996-2015 years,respectively from the overall and different economic stages,to analyse the impact and difference of monetary policy on the economic output and the impact of inflation in the eastern,northeastern,central and western regions of China.The results show that: First,there are some regional differences in the economic output and inflation in different regions in the effect of monetary policy;Second,in the short-term expansionary monetary policy will promote infaltion and the growth of economic output in China,and after a period of time,the effect of monetary policy gradually weakened,and finally the regional economic development tends to be stable,returned to normal level;Third,there are differences in the effects of monetary policy on regional economic output and inflation at different stages of economic growth.Compared with the stage of low economic growth,the implementation of expansionary monetary policy is more effective in promoting inflation,and the implementation of expansionary monetary policy has a greater negative impact on economic output in the period of rapid economic growth.Fourth,monetary policy on the eastern part of our country's economic output and inflation has a significant influence compared to other regions,so it can be seen in developed areas,economic output and inflation is more sensitive and rapid to monetary policy.Finally,according to the research results,this paper analyses the causes of the problem from the theoretical and practical point of view,and puts forward some policy suggestions.