The Emperical Analysis About The Effectiveness Of The Monetary Policy

The effectiveness of the monetary policy which is always controversial is a advanced theory . The emperical analysis about the effectiveness of the monetary policy lays particular emphasis on its effectiveness according to quantity. Real implementation of the the monetary policy in our country started in 1984 when the central bank system was established, during the practice of the monetary policy in the past 20 years ,the Centarl Bank frequently has used the monetary tool to adjust and control the macro economic,but whether the monetary policy is effective or not is a disputing topic at all time . generally come to the conclusion there are three: Affirmative completely theory , no symmetrical theory, and denial theory,Though systematacially emperical test and analysis to the effectiveness of monetary policy in our country ,we can not only quantify the effect of inplementing of monetary policy in the more 20 years but also has great significance in selecting proper monetary policy in the future.In the paper , on the basis of absorbing the research results which the domestic and foreign scholars did. Firstly , the paper described the basic theories of the monetary policy validity. Secondly, it reviewed the performance of our country's monetary policies and evaluated effects of these policies since 1984 .Thirdly, emperical test and analysis to the effectiveness of monetary policy in our country were conducted in the term of the annual datas for the year 1984-2007. By the aid of Eview5.0 ,I processed correlations test and carried out ADF test with four variables which were the different level's monetary supply ,GDP , price index . based on ADF test , then Granger Causality Test, Cointegration Test and Impulse Response Function were conducted to test the effect of monetary policy . Though these test and analysis ,I drawed the conclusions as follows:(1)The monetary policy of our country has promoted economic growth and was not neutral in the long term,just says it has been validity,But effectiveness is not strong.(2)The different level's monetary supply can produce different influence on economy.(3)The interest rate has not remarkable impact on economy. At last, based on previous conclusions, the paper analyze the primary cause of weakening the effectiveness of the monetary policy and gave some policy suggestion, hoping our economic to develop healthy.