An Empirical Analysis About The Influence Of The Third Party On China's Money Supply

With the deepening of financial innovation and the development of Internet technology,it is obvious that Internet Finance has effected the traditional monetary theory.In the process of e-commerce development,third-party payment arises at the historic moment due to the problem of credit and risk.The third party payment has the obvious substitution function to the cash.It has changed the social payment custom,caused the question of the basic currency,the money multiplier,the money supply quantity and the instability of the monetary policy.These problems are worth studying.From the existing literature,the research on third-party payment mainly focuses on the development model and regulatory approach,and mostly stays in the theoretical analysis level.The literature on the theory of third party payment and money supply is generally analyzed unilaterally from the velocity of money circulation or the monetary multiplier.In order to comprehensively explore the effect of third party payment on the supply of money in China,this paper intends to study how the third party payment can affect the money supply by influencing the currency circulation speed,basic currency and monetary multiplier in the framework of the theory of money supply,thus making suggestions for the better proof of the effect of China's monetary policy.Firstly,from the theory aspect,this paper discusses the problems such as the challenge of the third party payment brings to our country monetary stratification and it has deepened the money supply and so on endogenous question.On this basis,the paper analyzes the influence of third-party payment on the base currency,currency multiplier,currency velocity and money supply,and points out that third-party payment reduces the controllability of the base currency.It increases the monetary multiplier and increases the generalized monetary multiplier,reduces the velocity of currency circulation,and ultimately reduces the amount of cash and narrow money,but increases the amount of broad money.Secondly,Through the multiple linear regression model,it is proved that third-party payment reduces the amount of base money and weakens the ability of central bank to control the base currency.By cointegration test,the effect of third-party payment on the increase of currency multiplier is explained,and the result shows that the effect of third-party payment on the growth of broad money is more obvious.Through the establishment of a vector autoregressive model,it is proved that the third party payment has a "squeeze effect" on the currency circulation speed,and it has a negative correlation with it.Then,through the impulse response function analysis,how the money multiplier will change when the short-term system is impacted.By establishing cointegration equation and vector error correction model,the relationship between third-party payment and money supply at different levels is explained,and the basic money is tried to be based on "money supply determinism" and "money supply influence theory".Both the money multiplier and the velocity of money circulation are included in the unified framework of money supply.Finally,this paper summarizes the conclusions of the paper,gives the corresponding countermeasures and suggestions,and puts forward the direction of further research.Based on the objective facts of the effect of third-party payment on money supply,the regulatory authorities should accelerate the formulation of relevant legislation and further improve the third-party payment reserve system.In order to ensure the effect of monetary policy,the monetary authorities should further refine the monetary level of our country,and fully consider the influence of third-party payment on the amount of money supply when formulating monetary policy.