The Study Of Short-term International Capital Flowing In Our Country On The Four Motivation

With the continuous development of economic globalization and financialnetwork，capital is allocated to seek opportunity to arbitrage on a global scale.Because of potential development ability of emerging market is outstanding and theopportunity to profit is bigger, it is particularly favored by international capital.But,on the one hand, the quantitative easing economic stimulus policies of UnitedStates is gradually withdrew. The European and Japan is still immersed in monetarycarnival at the same time. On the other hand, real estate market, foreign exchangemarket and stock market of China volatility severely.However, the flow of large-scale capital will inevitably bring great challenges toeconomic stability, effectiveness of monetary policy, the security of financial system,and even political stability. In particular, after economic momentum reversingcollective evacuation will seriously affect economic, financial stability, and evencause the economic crisis. Therefore, this paper aimed to analysis the reason ofshort-term international capital flows to better understand the short-term internationalcapital, so we can better guide the short-term international capital flows.This paper mainly divides into six chapters. The first chapter summarizes thebackground and research significance of this paper. Secondly we comb the literatureabout the factors of affecting the international capital flowing, and put forward theemphasis and innovation points. The second and third chapters respectively elaboratethe development of the theory of international capital flow and the two stages ofshort-term international capital flows in our country.The Fourth and Fifth chapter is the main part of the paper. On the analysis of thearbitrage, cross rate, safety motivation, we study the the main motivations of theshort-term international capital flowing through through the VAR model, grangercausality test, impulse response and variance decomposition. The empirical resultsshow that the RMB exchange rate changes (arbitrage motivation), the10-yearTreasury yield of US change reflecting investors’ risk attitude (safety reason), the real estate price yield change (set price dynamics) is the main motivations of ourcountries’ short-term international capital flows, interest rate difference between theChina and the USA (arbitrage motivation), return on the stock market of China andthe United States change (set price dynamics) is not obvious in our country.We analyze the impact of short-term international capital on China’s macroeconomy and the influence mechanism in the sixth charter. According to the empiricaltest results, we suggest that our government should use interest rate policy flexibly,moderate enlarge the range of RMB exchange rate, improve cross-border supervisionmechanism of capital flow to effectively guide the short-term capital flows, reduceand ease the impact of short-term capita on China’s economic and financial stability.