The Empirical Study Of The Impact Of Changes In Stock Prices On Monetary Policy In China

The stock market in our nation was established not before long, but has developed very fast. The development of stock market has impacted on the traditional monetary policy frame largely and the stock price changes have challenged the traditional monetary policy severely. The stock price changes have had tremendous influence on our country's monetary policy tools, money supply and monetary policy conduction mechanism. Specifically, the stock price fluctuations have changed the way and the effectiveness of monetary policy tools, the money supply quantity and the structure and have increased monetary policy conduction wealth effect channel and the investment effect channel. It is of significance thus to study thoroughly what effect has made on monetary policies by stock prices and what the degree of effect is.This dissertation begins with the theoretical analysis of stock prices to every aspect of monetary policy, including the influence on the monetary policy tools, the money supply and the monetary policy conduction channel. The steps in each part are reality first, empirical test secondly and combination of the above two finally. The conclusions are as follows. The rise in the stock price weakens the effects of deposit reserve system and central bank benchmark rate but strengthens the effect of open market operation. The stock price, the public's needs for M0, M1, M2 and the liquidity of money move in the same direction. The wealth effect produced by the stock price changes is obvious while the investment effect is weak or even negative. Based on the analysis, the author puts forward some policy proposals correspondingly. Firstly, we should strengthen the consummation of the stock market price monitor system. Secondly, it is necessary to adjust the range of statistics on money supply, which enables it comprehensively to reflect the entire social fund movement condition. Thirdly, we can advance consumption through the development of stock market. Fourth, it is necessary to control excessive credit contrary fund entering the stock market so that the investment effect can be improved.