The Relationship Between The Heterogeneity Of Commercial Banks And The Effect Of Monetary Policy In China

This thesis is trying to study the lack of effectiveness of China's monetary policy. This paper, based on the commercial bank which is the important node in the policy transmission mechanism, deduces that many kind of banks act differently in front of monetary policy impact through constructing a partial equilibrium model about bank portfolio.Then this thesis analyses China's bank panel data to testify their action's blocking effect while they meet monetary policy impact. State-owned banks are sensitive to monetary policies for their capital advantage and special status in China's financial system. State-owned banks can significantly reduce the external finance of investment and credit delivery in front of tightening monetary policy shocks. Under the demands of maximizing profits and asset size, joint-stock commercial banks and city commercial banks will reduce their credit delivery and expand foreign financial investment in front of the impact of tight monetary policy, so the effectiveness of tight monetary policy is affected negatively.Based on theoretical analysis and empirical test, this thesis proposes to establish a bank portfolio behavior-based system of monetary policy decision-making policy recommendations. In the monetary policy-making process, the micro individual bank balance sheets and their portfolios should be given enough attention and the implementation of various banks in monetary policy efforts should be focused on to safeguard the effectiveness of monetary policy transmission.