A Study Of The Influence On Money Supply Of China To Urban And Rural Residents’ Consumption

The results of the effect of money supply on the consumer’s consumption is one aspect of the effect of monetary policy, and also a sign of national policies to improve living standards. Through monetary policy, money supply shocks impact on the consumer, with the asymmetry of time and space, namely the asymmetric effects of monetary policy. Study asymmetric effects of monetary policy is good for the monetary authorities, for they can measure and predict the effect. Therefore, from the asymmetry of monetary policy perspective, research in different periods of economic development, expansion and contraction of the money supply shocks have practical significance for the impact of urban and rural residents’ consumption.Paper summarizes the formation mechanism of the money supply consumption asymmetric impact on the residents, combined with the historical situation of China’s monetary supply and consumption of urban and rural residents, analyzes the impact of asymmetric effects of monetary supply to urban and rural residents’ consumption, and through the establishment of a vector autoregression model (VAR) approach to empirical test. The results show that, period of economic prosperity and recession, urban and rural residents’ consumption of money supply shocks have asymmetric response effect; consumption effect of tightening monetary supply shocks is greater than the consumption effect of expansionary monetary supply shocks;the extent of the impact of money supply shocks on consumption of rural residents is greater than its impact on consumption of town residents; impacts of money supply to residents’ consumption have a certain time lag, and the effects of expansionary monetary supply shocks lag is longer. Finally, according to the results of theoretical analysis and empirical analysis, from the flexibility to adjust the money supply and improve the monetary policy transmission channels, makes policies to promote the effects of money supply policy to regulate residents consumption Specific policy measures, including according to the stage of economic development, and the gap between urban and rural development in China, making flexible choice of monetary policy tools, regulating the money supply flexibility; formating mechanism by promoting market-based interest rates and exchange rates, improving the degree of participation of the residents in financial markets, taking measures to improve currency policy transmission channels.