Feasibility Analysis Of Social Financing Scale As The Intermediate Target Of Monetary Policy

With the improvement of our financial system, the indirect financing modeldominated by the banking system in China is shifting, and the direct financing plays ahuge role in China’s economic and financial development. This requires regulatoryauthorities change the past regulatory ideas which focus on the money supply, and payclose attention to macro liquidity management. Then our country put forward the socialfinancing scale indicators, to measure the degree of financial support for the realeconomy, social financing scale become a new evaluation index system in our country’seconomy. Government work report of China in recent years constantly stressed the needto maintain a reasonable social financing scale and structure. Therefore, the system ofsocial financing scale study has important theoretical and practical significance, wetherthe social financing scale is suitable as an intermediate target of monetary policy, itdirectly affects the development and effective conduction of monetary policy and thestability of China’s economic.The paper based on the combination of theoretical research and empirical research,in theory, this paper describes the definition of social financing scale, content andconstituent elements, then analyze its social background and theoretical basis, andprobes into the construction of index system of social financing scale, in-depth analysisthe index of social financing scale. In addition, this paper analyze whether the socialfinancing scale is suitable for the role of monetary policy intermediate target in China.Firstly, through the study of monetary policy intermediate target defects in our country,the paper analyze the social financing scale indicators to find out whether it could makeup the defects, and play positive role in the middle of the indicators and economicmacro-control of China’s economic development; Secondly, it analyzes whether socialfinancing scale could meet the intermediate target of monetary policy as controllability,scalability, relevance, interference, etc, and find out the rationality of the analysis as ourcountry monetary policy intermediary goal; Finally, it analyze the possibility of thesocial financing scale as China’s monetary policy intermediary goal, which has thepractical significance and the existing difficulties, and then the paper comes to theconclusion. In the empirical test, using the quarterly data between the first quarter of2002to the second quarter of2014, the social financing scale relations with our country main economic indicators were studied, through the unit root test, cointegration test,granger causality test, impulse response analysis, analysis of social financing scale asthe feasibility of the monetary policy intermediary goal. Through theoretical studies,comparative analysis and empirical testing, the paper finally draw the conclusions:social financing scale has a long-term stable equilibrium relationship betweenmacroeconomic goals of our county, according with the requirement of measurability,controllability, relevance, which can affect the currency stability and economic growthof our country. Social financing scale, therefore, as China’s monetary policyintermediary goal, is both the reality of our country’s economic development, but alsoour lessons from overseas, an important breakthrough in China to seek appropriatemonetary intermediary targets. The problems existed in the social financing sale, just asthe index system and the institution construction, should be constantly refined andimproved, making it suitable for China’s macro-control and monitor.The main innovation of this paper is: first, the social financing scale appears latelyand lacks of systematic research, this article will multiple perspectives on this indicatorto parse, analyze its content and construct the index system; Second, Previous studieswhich analysis the intermediate target of monetary policy, often focus on the moneysupply, interest rates and other indicators, while there is few paper studied on the socialfinancing scale. So the paper compares the applicability of different indicators in Chinaand then make a conclusion, which get innovation in perspective research.