Study On The Currency Internationalization From The Perspective Of Transaction Efficiency

Since 1980s,with the development of economic globalization and accelerating flows and growth in the international capital,the topic of currency internationalization is hotter.In recent years,as China's overall economic strength,the needs of a diversified international monetary system and the development of the Asia Pacific region,the RMB internationalization is getting more and more attention.China's RMB internationalization has made some progress,but there have been a series of corresponding development problems.Therefore,it is needed to analyze the currency internationalization from a more micro level and have a sound grip of international monetary connotation and mechanism.Only on these basis,the design of RMB internationalization would be more effective.The research of this paper is carried out from the perspective of transaction efficiency,which considers that international currency is a kind of currency which plays all the monetary functions in the world.The function of medium of exchange is the most basic and important function.In this regard,the higher transaction efficiency,the stronger influence of currency will be able to expand to the world through the market transaction network.As a result,the currency will gradually achieve all the functions of the international currency and become an international currency.In the theoretical analysis part,this paper analyzes the two main forms of human's trading activities:trade and financial transaction.Through the theory on the trade and financial development,I demonstrates that the transaction efficiency can affect currency internationalization from the two mechanisms of trade development and financial development.It also concludes that trade development plays a fundamental role and financial development is the necessary condition.Then the paper introduces the process of the internationalization of the US dollar,Japanese yen and German Mark.From their experience,I verify the correctness of the foregoing theory and conclude that a currency internationalization should be based on the trade development and supported by the financial development.At the same time,it also introduces China's transaction efficiency and draws the conclusion that China is the largest trading country but still needs to develop its finance.In the empirical part,I select a series of transaction efficiency index which includes 11 countries' data from 2003 to 2014.Then I analyze the currency transaction efficiency index system,and obtain all the countries' transaction efficiency scores.By logistic model,I verify the theoretical relationship between the transaction efficiency and currency internationalization and demonstrate that the transaction efficiency has a positive impact on the currency internationalization.Finally,by comparing the difference between countries' transaction efficiency index system,it is easy to find that China has advantage in economic strength and foreign exchange reserves but is weak in financial development,education,and so on.In conclusion,this paper argues that in the process of RMB internationalization,we should be actively committed to improve the transaction efficiency of our country.We should also implement the strategy of promoting the development of trade as the main impetus and developing the finance as a guaranteed act.