Empirical Analysis On The Impact Of China's Monetary Multiplication Of Electronic Money Development

With the rapid development of network finance,the emergence of electronic money,greatly promoted the development of electronic currency payment,it changes the traditional payment and consumption habits,and brings convenience to the traditional financial payment,also brings a strong impact and challenges for it.The current theory of monetary research shows that the money supply is composed of two important factors:the base currency and the monetary multiplier.When the base currency is fixed,the money supply will change with the variation of the money multiplier.Generally speaking,the central bank can control the basic currency,but for the money multiplier,the central bank can't control it completely.In this paper,we use the method of theoretical research and empirical research to analyze the impact of the current development of electronic currency on China's monetary multiplier.In the theoretical research section,regard electronic money as an important factor which can affect the change of China's monetary multiplier,and introduce it into the traditional money multiplier model,the influence of electronic money on the four determinants of China's monetary multiplier is deeply studied,the conclusion is drawn that the electronic money has amplification effect on the narrow money multiplier and the broad money multiplier in China.In the process of empirical analysis,related data from 1990-2015 years of domestic monetary multiplier,through empirical unit root test,co integration test and causality,Grainger multiple regression method,verified electronic money on monetary multiplier effect,and summarizes the development of electronic money enhances the endogenous nature of money multiplier,make the central bank control money supply difficultly,thereby reducing the substitution effect of the effectiveness of monetary policy and electronic money replace cash obvious,based on the conclusion,give the following recommendations to the central bank:take the strict regulatory measures of electronic money,such as pay the reserve,liquidity risk reduction of electronic money;using the M₂ as the main index;asset security guarantee for the electronic money issuer;increase in related infrastructure investment,such as electronic money payment to provide support and protection to it;strengthen the supervision cooperation with foreign central banks etc.