The Exploration To RMB Exchange Rate In The Perspective Of Game Theory

In recent years, the market has a strong expect to the appreciation of RMB.We should measure and calculate the equilibrium rate of exchange standard of RMB in order to judge whether the RMB exchange rate is reasonable. Equilibrium rate of exchange is one of the essential questions of exchange rate, and the main objectives to judge whether the standard of effective exchange rate is imbalance and whether there is any need to adjust the exchange rate policy.Based on the research results from home and abroad and our country’s economy character, this article is to explore the Exchange Rate Determination of RMB both from the angle of theory analysis and positive analysis. By construct the Two-level Game Model, the theoretical research part adopts the angle of Game Theory to analyze Exchange Rate Determination of RMB on national level and international level. The positive analysis is based on the Single equation model theory to make an empirical examining on the RMB Exchange Rate. The theory uses the ADF method to make stationary analysis on all variable quantities, and applies the cointegration analysis and error correction model which can reflect the short-term adjustment. On this basis, this article applies H-P Mean Filter to estimate the Equilibrium Rate of Exchange of RMB and make a rationality assess on the Real Exchange Rate of RMB. The conclusion shows that before2008, compared with the Equilibrium Real Exchange Rate of RMB, the real effective exchange rate of RMB is underestimated, through this round’s appreciation, the Effective Exchange Rate of RMB is almost near the Equilibrium Real Exchange Rate of RMB. After2008, the economic crisis and the pressure came from Europe and America and the substantially devalue of USD result in the overrate of Real Exchange Rate of RMB. In the auther’s eyes, as the arrival of the Post-crisis era, the exchange rate of RMB will be back on the equilibrium level, and gradually be more stable.This article is based on the above mentioned theory, empirical study result, and makes a comparative analysis with JPY appreciation to explore on the effect of RMB exchange rate adjustment and at last come up with the suggestion of further improving The RMB exchange rate reform mechanism.