Research On The Excess Capacity And Bank Liquidity In China

Times after the financial crisis,China’s economy in the gain of the high economic growth,exposed some deep-seated problems,such as the imbalance of income distribution,the imbalance of internal and external economic,the imbalance of real economy and virtual economy,which are the "growing pains” in over 30 years of reform development after the rapid development.Excess capacity and liquidity imbalance is the concentrated reflection of these problems,it permeates in various aspects of the economy by the production field and currency circulation field and eventually produces adverse effect on coordination and stable development of economy.Is there an association between excess capacity and liquidity imbalance? If there is,what kinds of logical relationship both have? How to solve the problem of excess capacity and liquidity imbalance of China? In this paper,it mainly from the liquidity of bank credit funds,around the theme of excess capacity and liquidity imbalance,theoretical analysis and empirical research the relationship between the excess capacity and bank liquidity imbalance in our country by using regional economics,industry economics,finance,econometrics,management and other relevant theoretical knowledge.Before analysis,first of all,we should define the relevant concepts of excess capacity and bank liquidity,and review the theoretical results at home and abroad.Then we can descriptive statistics analysis the characteristics of excess capacity and bank liquidity imbalance in our country.This passage mainly from the following aspects:Firstly,this paper analyzes the functional mechanism and transmission mechanism of excess capacity and bank liquidity imbalance.First on the overall analysis of the relationship between excess capacity and bank liquidity imbalance,starting from the capacity of supply and demand,analyzes three main effect on capacity of supply and demand from the local government,the central government and bank,and on the basis of investment theory,the relationship model between excess capacity and investment put forward,which explained the dynamic evolution of excess capacity and bank liquidity imbalance relationship.Then based on the bank liquidity exist total surplus and imbalanced structure,respectively from the perspective of internal and external imbalances in economy and bank credit risk analyzed the transmission mechanism between excess capacity of bank liquidity surplus,and from the the perspective of credit capital allocation analyzed the transmission mechanism between imbalanced structure of bank liquidity and excess capacity.Secondly,this paper makes an empirical study of the relationship between excess capacity and bank liquidity total surplus.First we choose some indicators which can reflect excess capacity and excess liquidity,and then test whether a relationship between excess capacity and excess liquidity by using cointegration test and Granger causality,the results show that excess capacity is Granger cause of bank excess liquidity.But bank excess liquidity is not the Granger cause of excess capacity,this may be due to the overall analysis ignores individual difference,thus affecting the estimation results of the model.And the cointegration test indicates the excess capacity and bank excess liquidity having positive cointegration relationship.Based on the perspective of internal and external imbalances in economy,we make an empirical analysis for transmitting path of excess capacity and bank excess liquidity by using the intermediary variable method,the results show that 1)between 1998 and 2014,excess capacity resulted from the imbalance between investment and consumption;2)the imbalance of payment had conduction effect between excess capacity and bank excess liquidity.Finally based on the theory of investment demand,economic variables of the top ten industries with excess capacity as panel data,research on the relationship between industries with excess capacity and bank excess liquidity,the results show that industries with excess capacity having significant negative impact of domestic investment in fixed assets.The excess capacity makes the commercial Banks stint loans in order to avoid risks,and the industries with excess capacity shows the caution in loan due to the decline in the economic benefits,the government takes the compression of the bank credit policy to curb excess capacity,which make domestic investment in fixed assets restrain,and commercial bank is difficult to extend to other loan channel in the short term after money exiting from industries with excess capacity,which lead to bank excess liquidity problems.Third,this paper makes an empirical study of the relationship between the imbalanced structure of bank liquidity and excess capacity.Respectively from the perspectives of regional and industry has carried on the empirical research.The region levels: firstly,using the method of production function to our country 29 areas from 2000 to 2013 calculates the degree of excess capacity.Based on the 2000-2013 panel data of 29 areas in our country,using EVIEWS7.2,respectively from the east,middle,west and northeast regions research on the relationship between the imbalanced structure of bank liquidity and excess capacity.It is found that the bank liquidity is closely related to the capacity utilization,but regional differences.the greater the level of bank liquidity,the smaller the capacity utilization in the region,the more serious the excess capacity.And west bank liquidity surplus coefficient absolute minimum,shows that the influence degree of the industrial capacity utilization to bank liquidity in the western region is lower than the other three regions,thus confirms that the imbalanced structure of bank liquidity sparked excess capacity.Industry level,by introducing an intermediate variable named credit capital allocation,analyzed the imbalanced structure of bank liquidity influence on excess capacity.Respectively research on the relationship between the credit capital allocation and excess capacity,and the relationship between the imbalanced structure of bank liquidity and the credit capital allocation.the results showed that the higher the degree of imbalanced structure of bank liquidity,the lower efficiency of the credit capital allocation.And the efficiency of credit capital allocation has difference in the industries,the efficiency of credit capital allocation with excess capacity is lower than the non-excess capacity,which indicates the credit capital allocation is not reasonable in excess capacity.Credit funds centralization and discrimination phenomenon is very obvious,credit funds has not been able to configure in the industry with a higher value creation.Credit rationing imbalance lead to overcapacity problem is prominent.It has been proven definitively the imbalanced structure of bank liquidity lead to excess capacity prominently.Finally,policy suggestions of dissolve excess capacity and bank liquidity imbalance are put forward from the central government,local governments and financial institutions,and summarize the research conclusion.