Contemporary monetary and financial theory papers
[Information Introduction]
abstract:
Starting with the main role of interest rate in the national economy and its management system, this paper discusses the necessary conditions of interest rate marketization and the countermeasures that China should take, and explains the inevitable trend of interest rate marketization and the problems existing in the process of interest rate marketization in China.
Keywords: interest rate marketization, macroeconomics, interest rate management
[content]
catalogue
First, the main role of interest rates and interest rate management system
Second, the main situation of interest rate management system in China.
Third, the necessity of interest rate marketization and problems that should be paid attention to
Fourth, China's interest rate marketization.
[Original]
Interest rate is one of the most concerned economic variables in the economy, and the news media reports its changes almost every day. It is closely related to our daily life and has a great influence on the healthy development of the economy. Interest rates are determined by many economic and non-economic factors, and in turn, interest rates also play a role in many economic variables. Interest is the condition for the establishment of credit relationship, and the existence of interest makes credit relationship produce, develop and expand, thus promoting social and economic development.
First, the main role of interest rates and interest rate management system
(1) Generally speaking, interest rates play a role in the following aspects:
1. Interest rate affects money demand.
In the theory of liquidity demand, the higher the interest rate, the higher the opportunity cost of speculative money demand, so the lower the money demand; In other money demand theories, interest rate itself is a kind of cost that debtors have to pay, so interest rate and investment demand will fall. The influence of interest rate and money demand depends on a country's interest rate environment-interest rate elasticity.
2. Interest rate is an important tool to regulate money supply.
First of all, the money supply depends on the size of a country's base currency and currency multiplier. The base currency is the sum of cash issued by the central bank and liabilities to commercial banks. Obviously, there is no direct relationship between the two. However, there is an indirect relationship between the two: due to the rise in interest rates, the total social deposits increase and the cash decreases, that is, the withdrawal of credit, which reduces the cash in the base currency.
Secondly, the direct factors affecting the currency multiplier include cash leakage rate, deposit reserve ratio and excess reserve ratio. There is an indirect relationship between interest rate and cash leakage rate: with the increase of interest rate, the amount of cash returned increases, thus the cash leakage rate decreases; At the same time, the opportunity cost of excess reserve increases, so the excess reserve ratio will also decrease, thus increasing the money supply. The increase of interest rate makes the supply and demand of money affect two opposite aspects at the same time, so it can alleviate the contradiction of excessive demand for money.
3. Interest rate is an important means to adjust macro-economy.
The rediscount policy of the central bank is actually the interest rate policy of the central bank. When the economy is depressed, the central bank can stimulate demand by lowering the rediscount rate; When the economy is in inflation, the central bank raises the rediscount rate and increases the investment cost, thus restraining the excessive demand for money.
......
[reference]
Reference materials?
1 Li Xiao, Ni Wei and Zhang Qin (1999): Economic Globalization and China's Strategic Choice, Social Science Edition of Jilin University,No. 1. ?
2 [America] Edward? Xiao (1988): Financial Deepening in Economic Development, Shanghai Sanlian Bookstore. ?
3 [America] Ronald? Mckinnon (1988): Money and Capital in Economic Development, Shanghai Sanlian Bookstore. ?
4 Hu Angang (1999): A dialogue in the article "The Best Time for Experts to Analyze the Bank's Liberated Interest Rate" published in Wang Zhongjing 1 1. ?
Jason (1996): local government intervention and the variation of financial system, Economic Research, No.3 ...
Wang Huaqing, the research group of Shanghai Branch of the People's Bank of China (1998): An empirical analysis of the correlation between interest rate changes and the choice structure of financial products in China, Research Report on Financial Hot Issues in China, Economic Science Press.
7 [America] Ronald? Mckinnon (1997): The Order of Economic Marketization, Shanghai Sanlian Bookstore, Shanghai People's Publishing House. ?
8 Xie Ping (1999): "Challenges Faced by China's Financial Reform", "China's Industrial Economy", No 4.
Remember to adopt