Analysis Of RMB Substitution Elasticity And Influencing Factors In ASEAN Region

In recent years,with the medium-high speed growth of China’s economy,the establishment of China-ASEAN Free Trade Area and the proposal of "One Belt,One Road",the economic integration between China and other Asian countries has been getting higher and higher.The RMB has been increasingly accepted by neighboring countries and regions,and its international influence has been greatly increased.Therefore,it is of great theoretical and practical significance to study the current situation of the use of RMB in the ASEAN region,analyze the elasticity of substitution of RMB and its influencing factors and accelerate the regionalization of RMB and promote the wider circulation of RMB.Based on the extended asset portfolio theory of currency demand,this paper uses the dynamic panel model GMM estimation to make an empirical analysis on the elasticity of RMB substitution in seven ASEAN countries,and puts forward relevant policy suggestions.This paper is divided into six chapters.The first chapter is the introduction,which expounds the research background and significance of this paper,summarizes relevant literature after combing,and then expounds the research ideas,research methods,structural framework and innovation points of this paper.The second chapter is the theoretical basis of RMB substitution.This paper expatiates on three theoretical models:the production function of monetary service,the marginal utility of monetary demand and the asset portfolio of monetary demand,and the optimal theoretical model applicable to this paper is found through comparative analysis.The third chapter analyzes the current situation of the use of RMB in ASEAN region.By analyzing the RMB trade settlement status,RMB investment status and RMB deposit status in Singapore,Indonesia,Malaysia,Vietnam,Thailand,Cambodia and Myanmar,this chapter lays a foundation for the following research on currency substitution.The fourth chapter is the measurement analysis of the elasticity of substitution of RMB.In this part,datas from 7 countries in the ASEAN region in the 28 quarters from 2012 to 2018 are used to calculate the elasticity of substitution of RMB in each quarter,so as to quantify the use of RMB in these seven countries.Then,a horizontal and vertical comparative analysis of the monetary elasticity is conducted to obtain the dynamic evolution process of the degree of currency substitution.The fifthchapter is the empirical analysis of the influencing factors of RMB substitution elasticity.Taking the measured value of elasticity of substitution of RMB as the explained variable,the dynamic panel system GMM estimation method is used to analyze the influencing factors by country and time.The sixth chapter is the conclusion and countermeasures.The conclusions of the above chapters are summarized,and then relevant countermeasures and suggestions are proposed to reduce the elasticity of substitution of RMB and promote the wider circulation of RMB.There’s a breakthrough in both theory and practice.In theory,this paper on the basis of the portfolio of monetary demand theory,joins effective variables in the production function of monetary service and the marginal utility of monetary demand.It can not only explain the single theory,but also effectively solve the problem of overlapping explanatory variables in the theory.Compared with the previous separately using a theoretical model is more scientific and accurate.From the empirical point of view,this paper intends to use GMM estimation of dynamic panel model to conduct in-depth research on the dynamic evolution of RMB substitution and its influencing factors in ASEAN region.This paper takes into account the influence of trade and other factors to deeply explore the dynamic evolution of RMB substitution,which can more accurately reflect the influence of different economic variables in ASEAN region on RMB substitution,and is conducive to a deeper understanding of the importance of influencing factors,so as to formulate accurate strategies to promote RMB regionalization.The empirical results show that China should focus on the in-depth implementation and promotion of "interconnectivity" with ASEAN.On the one hand,continuously improve our own economic strength and maintain exchange rate stability,on the other hand,deepen cooperation with the ASEAN countries,such as enlarging the scale of direct investment,through the long-term policy and to perfect the economic system to eliminate all sorts of obstacles in the process of cooperation.We will accelerate the pace of opening-up on the basis of reducing the elasticity of RMB substitution and preventing risks.From the trend of RMB substitution elasticity,the index of RMB substitution elasticity of Thailand,Myanmar and Indonesia has declined,so we can consider increasing the cooperation with these countries in the future.