| Our country is vast, there are huge differences between regions in industrial structure, financial structure and system perfection, openness, marketization, consumption habits and population structure and other aspects. Provinces and municipalities in the eastern coastal region have higher marketization, openness and more developed financial market than those provinces and municipalities in central or western region.However, the implementations of our country’s monetary policy are always based on the whole national macro-economy. One curiosity was that, does the unified monetary policy based on the whole national macro-economy have the same influence to the development of different regions. Study on the regional effects of the monetary policy plays a very important role, it can help the macroeconomic decision makers to make a better monetary policy that is more reasonable, conducive to the balance the development between different regions. Also it can reduce the gap of regional economic development, and for the entire, improve the power to keep sustainable development. So the research on the regional effects of China’s monetary policy is very meaningful.Firstly, this paper introduces the relevant literatures and basic theories about the study of the regional effects of monetary policy.Then, this paper selects the annual data from1984-2010and tests the regional effects of monetary policy in our country by establishing VAR models and doing impulse function test firstly from the interprovincial perspective. The results show that our country has obvious regional effects of monetary policy, including the regional effects of monetary policy on output and price.In case of the regional effects of monetary policy on output, the change of the monetary policy has larger impact to most of the provinces and municipalities in the eastern region (except Beijing) than provinces and municipalities in the middle and western region. Moreover, the change of the monetary policy has little impact to most of the provinces and autonomous regions in the western regions. After the research, this paper found that the difference of industrial structure is not the reason that causes China’s regional effects of monetary policy, while the difference of industrial business dimensions structure, industrial business property right structure, the development of capital market and openness are the reasons. In case of the regional effects of monetary policy on price, no matter provinces, municipalities or autonomous regions in the eastern region or in the middle and western, the influence of monetary on them is big and small. Although the regional effects of monetary policy on price doesn’t have an obvious regular like the regional effects of monetary policy on output, on the whole, the change of monetary policy has a larger impact to most of provinces and autonomous regions in the middle region. Through qualitative and quantitative analysis, this paper found the difference of regional industry structure, population structure, the relative house prices (Housing Price-to-income Ratio) and consumption expenditure structureare the reasons lead to the regional effects of monetary policy on price in our country.Finally, this paper puts forward some policy suggestions on how to solve the existing problem of the regional effects of monetary policy, such as, for the central bank, it should speed up the process of the commercial bank loan interest rate marketization and implement the monetary policy appropriately, etc.; And for the local, it should be constantly optimize the regional industrial structure, improve the degree of marketization and opening, and so on. |
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