Research On The Monetary Transmission Mechanism And Financial Assets Effects

This paper makes a systematic expatiation of several main monetary transmission mechanisms in enclosed economy, and offers comments on them, including Keynes effects, real balance effects, financial assets effects, credits availability effects, expectancy effects and other relevant Macro-economics theories. At the same time, it has carried on a discussion and a primary research on the effects of the above transmission mechanisms. The analysis of this paper has produces following results:First, although monetary transmission theories have great difference from each other, these differences lie in the adjustment scope of the assets that they investigate; Second, the methods by which money affects economy are various, so it has a strong influence, however, the change in the amount of money will not only cause the change of the total demand, it will also lead to a change in total supply by corresponding expectancy, thus in a long term we can't rely on the expansion of money to expand the production; third, Third, with the deepening of the reform, the above monetary transmission mechanisms will play a more and more important role in China's economy, and the influence of currency to the economy will be more and more strong, but since the correlating Micro-mechanisms is mot integral, we should be highly cautious when this change takes its place.