Research On The Influence Of Shadow Banking On Housing Price In China

Shadow banking refers to certain financial institutions and business isolated from convertional banking system,with the function of providing liquidity and credit transmission and purpose of regulatory arbitrage.The scale of shadow banking has expanded constantly in recently years.According to the report of Moody,the scale of shadow banking's assets in China has reached up to 64.5 trillion yuan in 2016.Meanwhile,the central bank of China has implemented variety of moneytary policies to prevent the excessive flow of credit to the real estate market.The effect of policy adjustment did not meet the expectation,since the real estate price is still rising.As an important supplement of traditional lending chanel,shadow banking raised large amount of funds for real eatate market,weakening the effectiveness of monetary policies in the control of real estate price.In this context,a deep analysis of the patterns of shadow banking and mechanism of shadow banking on real estate price will be of great help for government in the control of real estate price,the supervision of shadow banking and promoting the stability of financial system.This thesis basically studies the effect of shadow banking on real estate price from theoretical and empirical aspects.Chapter one briefly introduces the background,significance,literature reviews and innovation of this thesis.Chapter two introduces the definition,causes,development phases of shadow banking in China and measures the scale of shadow banking based on available data.Chapter three and four revisits the history of China's real estate market and explores the effect mechanism of shadow banking and conventional monetary policy instruments on real estate price and its regional heterogeneity.In Chapter five,we make SVAR model consisting of shadow banking,conventional monetary policy instruments and real estate price and explore the effectiveness of shadow banking on real estate price using quarterly data from 2006 to 2016.The empirical result shows that shadow banking promotes real estate price significantly in general.Then we divide the whole country into three regions,according to economic and financial developing situation.Region-level regression shows that the positive impulse effect of shadow banking on real estate price is stronger in the east while weaker in the west.The positive impulse effect of money supply on real estate market is stronger in the west.The negative impulse effect of interest rate on real estate market is stronger in the east.The conclusion of the thesis are as follows:Financial industry regulator should implement more stringent regulation on shadow banking system to prevent exceeded funds from moving towards real estate market.Meanwhile,differentiated regulations should be taken into account according to certain region's economic and financial developing situation.