The Influencing Factors And The Changing Trend Of Money Velocity In China

With enrich and perfect the monetary theory, also on the study of money velocity from most assume that it is a constant, steady into variables under the influence of various economic factors, the monetary velocity in recent years is the hot spot of economic and policy issues. Foreign economists studied money velocity early, in addition to assume that it is a stable and constant theory, some analysis of the influence factors in system, money velocity equation is established; The study of money velocity in China started late, most of focused on the market and institutional factors of our country. Equation in this paper, the development of multiple factors McCallum rules, establish a growth rate of money velocity and expected growth rate of national income, the previous national income gap rate,inflation rate, monetary measurement of financial assets growth rate, the relationship between the quantity of growth, it is concluded that the in the case of other conditions unchanged, expected growth rate of national income, the previous national income gap rate,growth rate of money value of financial assets, the rate of inflation and the growth rate of money velocity is positive correlation, and quantity of growth and the growth rate of money velocity is negative correlation. And use the data for statistical analysis of our country, through the regression and Granger causality tests show that this equation is in conformity with the actual situation of economic operation in our country, at the same time,predict the money velocity declining in the next few years. Then, in this paper, by comparing the United States, Britain and Japan’s three major developed economies monetary velocity data found in 50 years, the three developed economies monetary circulation speed also has been decreasing, but have different amplitude. The money velocity changes smoothly in the United States, is relatively more stable because of its economy, monetary policy is more mature, more influence on the world economy; British money velocity changes the steep, it is because of its economy since the second world war had a greater influence on the political and military environment; Japan’s monetary velocity change relative is in the position, is due to its impact on the economy by the United States and relatively stable development in recent decades. Finally, in combination with the results of theoretical and empirical analysis, in the face of China’s recent economic downward pressure is large, put forward to combine, monetary policy, stabilize the domestic financial order and reasonable set inflation target, in order to make thedevelopment of our country’s economy can be better and more stable; Also suggests that China facing current economic challenges and opportunities: on the one hand the economic downward pressure is huge, the enterprise operating costs are high, and the traditional energy and building materials related industries with excess capacity, staff spending difficult, part of the local government finances hard; On the one hand, with the deepening of the reform and opening up, China’s economic marketization degree increasing, the resource allocation efficiency improved significantly and the economic structure transformation into hard time. So in this critical period, the economic policy of China should be more careful, especially with China’s open in the field of financial and capital,domestic economic and financial environment under the influence of international economic and financial increase, more in need of a long-term stable countries and people’s expectations, economic and financial policy in a flexible short-term policy make our country economic growth and financial asset prices keep within a reasonable range.