Research On The Impact Mechanism Of Fiscal Stimulus On Excess Capacity

Since China's reform and opening up in 1978,the economic growth has made great achievements under the impetus of local government,but it has also accumulated some outstanding problems,especially the overcapacity problem.Overcapacity is the embodiment of economic inefficient operation,which will eventually lead to a series of problems of vicious competition,industrial organization,and increase the risk of serious waste of resources,industrial upgrading difficulties,and even lead to financial crisis,seriously affecting the sustainable and healthy national economy and the coordinated development.Therefore,it is urgent to find out the causes of overcapacity and then solve the problem of overcapacity.At present,most scholars in our country believe that the government subsidies to enterprises is the main reason for overcapacity.Based on this fact,this paper establishes the DSGE model simulation China fact macroeconomic analysis with government financial subsidies on the capital utilization rate,the mechanism to choose between the government and enterprises on the use of subsidies to the enterprise capital.In order to better fit the characteristics of China's economic operation,this paper does the following three extensions to the basic DSGE model:(1)Because the investment decision of enterprises is closely related to the financing mode of enterprises,the main financing mode of most enterprises at present is bank loan financing.In order to characterize the financing environment of enterprise better,this paper introduce financial frictions through credit constraints,namely the enterprise must provide collateral for a loan,this paper built the model of collateral for the entrepreneur capital;(2)In order to analyze the entrepreneur's capital investment decision better,the adjustment cost of capital is introduced;(3)Considering that the government's fiscal policy and monetary policy are often mutually complementary and complementary,in order to strengthen the explanatory power of the DSGE model to China's real economic fluctuations,this paper introduces currency into the model.Through the simulation of the model in the MATLAB and Dynare software platform,the main conclusions of this paper are as follows: government subsidies will exacerbate overcapacity contradiction,and it will be more obvious when the government increases the money supply.