A Study On Regional Differences Of U.S.Monetary Policy’s International Spillover Effects

The issue of monetary policy’s international spillover effects has been a hot topic in international economy.However,both existing theoretical and empirical literatures did not give a clear answer about it. There are also no consistency conclusions about the mechanism of exchange rate regimes and capital controls in response to external monetary policy shocks. Then, under the conditions of China’s current open-door policy, exchange rate regime and capital controls, how does the U.S. monetary policy affect China’s macroeconomy? This paper, oriented to real economic datum,try to use the regional comparative method, including international comparison as well as internal comparison, to make a comprehensive grasp of the transmission channels and impact of U.S. monetary policy on China’s macroeconomic spillovers.Firstly, this paper reviews and combs the relative literatures about monetary policy international spillovers, and makes a simple comment. Secondly, this paper makes a theoretical analysis about the effects of U.S. monetary policy on other countries’currency and real economy.Thirdly, on the basis of theoretical analysis,this paper, based on SVAR models,examines and compares the spillovers differences of U.S. monetary policy shocks on other countries (regions)’macroeconomy under different economic openness, exchange rate regimes and capital account openness, using Chinese mainland,Hong Kong,Japan’s datum. For a further study,this paper also examines and compares the spillovers differences of U.S. monetary policy shocks on China’s eastern, central and western regions. Finally, summarize the results and make relevant policy suggestions.Nowdays,China’s economic reform,RMB exchange rate formation mechanism and capital account reform are being carried out under an extremely complicated international background.The comparative analysis results of this paper are important and meaningful for the adjustment of China’s current foreign trade policy, rational allocation of exchange rate regime and capital account policy to improve our ability to external shocks,especially U.S.monetary policy shocks.