The Effects Of Super-monetary On Chinese Economic

THESIS:The Effects of Super-monetary on Chinese Economic SPECIALIZATION:Finance POSTGRADUATE:Tingzuo Zhou MENTOR:Yihao Zhang, Associate ProfessorIn the background of M2/GDP rising, this paper has defined excess money both from the broad and narrow perspective, firstly. Then, we study the impact of excess money on inflation, asset prices and steady-state economy, just as below:(1) The impact of excess money on inflation. Real money supply rate growth will push the CPI 12 months later. The impacts of excess money on the main components of the CPI are different. In details, there are impacts on the food, fruit and living Price index, but no impacts on other Price index. About 55% of drastic fluctuations in the CPI were due to Real money supply rate growth.(2) The impact of excess money on asset prices. Relative money supply rate growth will push the asset prices in 4 quarters later. The impacts of relative money supply rate on the main components of the asset price are different. In details, there are impacts on the land transactions price and residential sales price, but no impacts on non-residential sales price. This paper also found that about 40% of drastic fluctuations in the real estate sales price index were due to relative money supply rate growth.(3) The relationship between excess money and steady-state economy. In this paper, the monetary factor has been introduced into the extended Solow model. With mathematical derivation, we found the relation between the relative money supply, the savings rate, the effective labor growth rate and per capita output growth firstly. Then, through empirical analysis by using the data from the various provinces of China, the paper found the continued rise of relative money supply has significant negative impact on economic growth. At the same time, the containment impacts were different according to the time and region difference specifically. We also find savings have a significant positive effect on per capita output, and that the effective labor rate has a significant negative effect on per capita output.