Monetary Policy And Enterprise Investment Fluctuation

Monetary policy is an important means of macroeconomic regulation and control used by our country’s central bank. The central bank will formulate appropriate monetary policies in time to respond all kinds of problems that occur along with the economic development of our country. Although foreign major economy bodies recover from the recession of the financial crisis gradually in recent years, the power of the economic growth is still weak. Under the background of the global economic depression, the situation of the domestic economic development is also far from optimistic----the speed of economic growth has changed from high speed to medium-high speed with our country’s economy entering a new stage of development, and the structural contradiction in economic development has become increasingly prominent. In order to solve these problems, our government puts forward the structural reform about the "supply side" and changes the way of economic development from traditional mode to innovation driven mode, realizing sustainable development of economy.Under the background of reform and innovation, the central bank carries out the prudent and moderately flexible monetary policy, stimulates the development of the real economy, investment and the consumption by giving the market a relaxing and liquidity environment. However the market reaction is far from what the government expected, for the speed of currency circulation is low and GDP growth rate hits a historical low in recent years, monetary policy faces the risk of the liquidity trap. Because of the economic malaise about the real economy, the enterprises’investment intentions for the real economy is rather low and they lack confidence in market. Otherwise, facing the risk of enterprise management, banks start to control the granting of loans, which lead to financing constraints of many companies. Furthermore, with the rapid development of the equity market and the real estate industry, they have attracted a large amount of money in the market during these years, which result in the lower data of the enterprises’ investment. Basing on the situation, the thesis will mainly discuss the relationship between monetary policy and investment of the enterprises from the perspective of liquidity.Firstly, this paper presents the research background, purpose and its significance, make comments on revelant researches at home and abroad. And then the paper introduces the research content and method and puts forward the innovation. Secondly, the thesis will summarize the theory of monetary policy and liquidity trap, focus on the monetary policy transmission mechanism theory and the liquidity trap theory, which is known as from the Keynes liquidity trap theory to the Krugman’s optimal choice model, and this is the theoretical basis of the whole passage. Thirdly, the paper will sum up our country’s monetary policy trends in recent years and analyze the liquidity trap risk faced by monetary policy in order to discovery the internal mechanism function of monetary policy in the enterprise investment fluctuation from the perspective of liquidity trap. This research paper will do some practical analysis about the relationship between the monetary policy and the enterprise investment fluctuation based on the completely theoretical analysis. And the paper will also analyze the direction and extent of the impact of monetary policy on corporate investment through the VAR method.Finally, we will get the main conclusions and the policy implications, that is, in order to realize the effectiveness of monetary policy, the government should improve the transmission channels of monetary policy, enhance investors’ expectations, increase the transparency of monetary policy, make the micro subject of the market perfect, and make the combination of the conventional monetary policy tools and the innovative monetary policy tools.