The Economic Analysis Of Treasury Bonds Policy In China

Economists pay more attention to Treasury Bonds which is an important measure in Chinese macroeconomic policy. Especially, the impact of Treasury Bonds on the economy and society has become the core issue that causes the intensive discuss among the economists. Treasury Bonds is a financial measure that bases the state credit and collects the fiscal capital for the government.It is unilateral to analyze the scale of Treasury Bonds from the ability of the private sector to buy and the ability of government to repay. In order to analyze the rationality of Treasury Bonds scale, the paper uses the dynamic relation of Treasury Bonds scale with economic growth and budget deficit to set up the sustainable development model of the Treasury Bonds scale, and makes empirical analysis on the Treasury Bonds scale through the model. From the model, we get the conditions for the sustainable development of Treasury Bonds scale. Treasury Bonds scale still has the potential expanding space with the healthy steady economic growth. It will not bring on the government fisical crisis. Through the Granger causality tests, the paper selects the main variables that influence the Treasury Bonds. The variables are GDP, financial revenue and expenditure, personal deposits. The paper builds long-run log-linear equilibrium equation and short run error correction model on the base of exercising unit root test and co-integration test for Chinese long-run macro economical variable data series by conducting co-integration theory and method. With this model it can better explain not only the long-run equilibrium relation between Chinese Treasury Bonds scale and macro economic variables but also the influential factors of Treasury Bonds short-run dynamic. The paper analyses the macro economic effect from the investment, consumption, net export. Although the large issuing of Treasury Bonds makes no evident effect on the net export, it does not bring on the so-called crowding-out effect, instead, it promotes the personal investment. Treasury Bonds has the wealth effect, enlarges the consumption demand and makes positive effect on the economic growth.In a word, as long as we analyze the policy of Treasury Bonds thoroughly, we can make better use of Treasury Bonds to promote the economic growth in China.