A Study On The Influence Of The Scale Of Shadow Banking System On The Effectiveness Of Monetary Policy

Shadow banking system is the financial institution and activity which exercises the functions similar to the traditional system and drifts away from supervision system.The growth of shadow banking system not only plays an important role in pushing economy growth,but also increasingly influences the effectiveness of monetary policy.The credit creation mechanism of the shadow banking system challenged the formation and Implementation of monetary policy.In this context,it has great significance for us to explore how to perfect effectiveness of monetary policy in order to further promote the economy growth.On the basis of the predecessors' research,the shadow banking system in this paper includes Loan by Mandate,Bank's Acceptance Undiscounted and Non-observed loan.After measuring the scale of shadow banking system,the paper theoretically analyses the mechanism that shadow banking system affects the monetary policy.Then the paper selects the scale of the shadow banking system(SB),intermediate goals of the monetary policy(M2),conduction mechanism of the monetary policy(rate and loan)from May 2004 to December 2015 to build the SVAR model,and then analyses the effectiveness of the shadow banking system on the monetary policy.The study shows that the growth of shadow banking system has play a positive role in promoting GDP in the short run and a negative role in promoting GDP in the long run at a rate of 18%,while it has a positive role in promoting the growth of CPI both in the short and long run at the rate of 20%.Finally,the paper gives the corresponding suggestions on how to increase the effectiveness of monetary policy,including smoothing the conduction mechanism of the monetary policy,perfecting the intermediate goals of the monetary policy,and strengthening the supervision of shadow banking system.