Empirical Researches On The Monetary System Of China

Monetary policy system is a key component of the modern market economy. It consists of the monetary policy tool system, the goal system, the channel system and the policy environment. Numerous existing researches tend to ignore the environment while overly focus on the other aspects of the system. This clearly contradicts the importance of the ever increasing complex economic system. The author attempts to incorporate an extremely important economic factor-the fictitious economy into the analysis framework.The fictitious economy encompasses the majority of the financial market(such as the banking industry, stock markets, and derivative markets),the real estate market, and part of the internet economy. Although they vary greatly in market size and functions etc., they all are very efficient in allocating resources and price discoveries.The author attempts to explore their advantages by focusing on their roles in channeling the effects of monetary policies. With the econometric tools(Vector Autoregression Modeling, Error Correction Modeling, Granger Analysis, Variation Partitioning Analysis, and Impulse Response Analysis), the author concludes that money supply is still the optimal intermediary goal of monetary policies, while interest exerts increasingly important effects in its role of the intermediary goal. In terms of monetary policy channels, interest dominates in channeling the intended effects of monetary policies;Fictitious economy as a whole is very effective in its role of monetary policies, while the banking industry ranks as the single most important industry in terms of monetary policy channeling, the stock market ranks the second, and the real estate market has no significance in this manner. Based on the conclusions, the author contributes some policy suggestions about the interest marketization reform and the stock market reform.