Research On China's Interest Rate Marketization Reform And Its Impact On GDP Growth

In order to adapt to the international trend after China's entry into WTO,interest rate liberalization has become one of the focuses of China's financial reform.As early as the 1970s,many countries started a wave of financial liberalization and reform.Economists in all countries have made in-depth researches on financial liberalization,and the discussion of interest rate liberalization in China is also carried out within this framework.Among many economic theories,McKinnon's and Edward Shaw's theories of financial repression and financial deepening have attracted the most attention.However,from the practical experience of interest rate liberalization in other countries,many countries have experienced economic recession or even financial crisis after they relaxed interest rate control.Therefore,it is still a long way to go for China's interest rate liberalization.Looking back on the process of more than 30 years,China has adopted a gradual reform policy,from easy to difficult,from incremental to stock,from partial to overall,from shallow to deep,and continuously improving.Of course,in the process of reform,we also encountered many problems,such as shadow banking,dual financial structure,double-track interest rate system,etc.It can be said that shadow banking is an inevitable outcome in the process of interest rate liberalization,and its existence also makes the financial market constantly innovate.However,since shadow banks are free from the regulatory system,handling the risks of shadow banks will also be the basis for ensuring the smooth progress of interest rate liberalization reform.At the same time,the financial disintermediation brought about by shadow banking is also pushing forward the liberalization of interest rate.In this paper,the process of interest rate liberalization in China is described in detail,and M2/GDP is proposed to measure the degree of financial deepening in China through financial deepening theory.However,after research,it is found that M2/GDP has many detects and cannot be well applied to interest rate liberalization reform.Therefore,by learning from and introducing the index of interest rate liberalization,the process of interest rate liberalization is indexed,and the index to measure the process of China's liberalization is obtained through principal component analysis.At the same time,it also uses the method of empirical analysis to study the impact of interest rate liberalization index and real interest rate changes on China's GDP growth.At the same time,four representative countries were selected to conduct in-depth analysis and learn from experience.Finally,according to the current problems and challenges faced by the interest rate liberalization reform,the paper puts forward the reform suggestions and the prospect of the future market.