Under The Open Economy, Monetary Policy In China International Coordinated Research

Monetary policy, as a vital macroeconomic policy, is an important tool of controlling economics and stabilizing the value of currency. However, in an open economy, formulation and implementation of monetary policy will be influenced by the other countries and economies and the influence is obvious between highly related countries. International monetary policy coordination (IMPC) will eliminate the policy contradiction and reduce the conflict of interest. From the Reform and Open China has gradually become an open economy, thus, our monetary policy will conflict with the interest of other countries. In order to minimize the loss caused by this conflict, China also needs international monetary policy coordination. But what is the theoretic basis of international coordination of monetary policy? And what is the effect of IMPC? In what way should it be carried out? And how to improve our country's IMPC? The answer to these questions is just the object and purpose of my thesis.The main idea and structure of this thesis is arranged as following: first, from the perspective of relationship between open economies, elaborate the influence of other countries to the monetary policy of one country; second, expound the theoretical reasons and methods and effects of this coordination; then explain the specification of international monetary policy coordination; finally analyze the reality requirement, current status, problems and future of our country's international coordination.In order to achieve this aim this thesis breaks into 5 parts. The preface introduces the requirement of IMPC by discussing the conflict of monetary policy in the open economy; points out China should consider both the influence of monetary policy to our country and the reaction ofinternational society. That is, our country should pay attention to IMPC and puts forwards the theoretical bases, effects and methods of IMPC.The first chapter defines the open economy and monetary policy; consider open economy is different from closed economy, in the open economy, one country is not isolated from world economy, and has extensive relationship with other economy. As a result, there are inevitable interest and economic conflict between one country and other economies. Second, analyze the influences on monetary policy in open economy, which include five aspects: 1.influece on the goals of monetary policy; 2. influence on the conduct mechanism of monetary policy; 3. influence on the effect of monetary policy; 4. influence on the intermediate targets of monetary policy; 5. influence on the operating methods. So we must recognize the formulation and implementation of monetary policy according to the economic and financial change, in short, we must recognize the international coordination of monetary policy.The second chapter, mainly analyze theoretically the foundation of international coordination of monetary policy. First, it defines the international coordination of monetary policy, and brings about the prerequisite of coordination; international coordination of monetary policy is a process in which a country adjusts its monetary policy reciprocally in fully considering international economic relation. International coordination only exists under the condition that economically interdependent countries coordinate their interest conflicts and benefit both. Afterwards, based on the theories of interdependence and spill-over effect, I analyze the realistic requirements and inner motives of international coordination of monetary policy, and answer theoretically the question why international coordination of monetary policy is needed. Last, according to game theory, it explains the basic methods of international coordination of monetary policy. From the views of game theory, the externality of each country's monetary policy hasbecome increasingly apparent in an extensively inter-depending open economy. As a part of world economy, one country's monetary policy will influence others' social welfare function. Adversely it is also affected...