Monetary Policy And Development Of Regional Economic

Regional economic development differences have been the focus of attention of regionaleconomics. Since the theory of optimum currency area, many scholars began studying therelationship of monetary policy and the unbalanced development of regional economy from nonsymmetry effect of monetary policy. Study of Chinese scholars on the regional asymmetric effectof monetary policy is generally the empirical test based on the theory of optimum currency areas.But the theory is to explain the asymmetric regional effects of monetary policy from the regionalpoint of view, rather than from the monetary policy itself. In addition, the existing research isinvolved in the transmission channel of monetary policy and regional economic development, butthey are from the existence of transmission channels. I think, various channels of monetarypolicy transmission may play some role in the actual operation, the difference is efficiency.This paper aims at the differences between the different parts of our country on the creditchannel efficiency. The article point from the credit channel of monetary policy, a theoreticalmodel is built to explore the credit channel, the basic conditions and the establishment. Firstconstructing the optimal bank credit supply and firm demand, obtain the mathematical equationof the credit channel; when it reaches the equilibrium market, money market and bank loan marketclearing conditions, the basic conditions are needed to meet the credit channel availability.Research shows that, the bank credit channel patency need to meet three conditions:(1) thecurrency impact is not temporary;(2) credit demand is not perfectly elastic;(3) non deposit debtsupply is not perfectly elastic. At last the basic factors affecting the efficiency of the credit channelwould be found. Research shows that, the importance of bank credit channel is a decreasingfunction of the bank and company size in the area.Statistical study shows that, bank and firm size in different regions of our country exists hugedifference. The empirical results show that, aggregation area in large banks and large corporations,bank credit has no predictive power for GDP per capita, and in small banks and small companiesgathered, bank credit has significant predictive power for GDP per capita. Therefore, theefficiency of credit channel exists obvious regional differences in China, monetary policy canproduce asymmetric effects on regional economy through the credit channel.