Research On The Influence Of Chinese Banking Competition On The Transmission Effects Of Monetary Policy

At the 19th National People's Congress of the Communist Party of China,Xi Jinping put forward requirements for banks to support the development of the real economy and prevent systematic financial risks.In this context,the State will increase its efforts to support the development of Chinese banking sector.With the changes in the market structure of the banking sector,the competition of Chinese banking sector are also becoming fierce.Commercial banks play an important role in financial market.Banking competition will affect the behavior of commercial banks in the credit market,thus affecting the scale of commercial bank credit.The changes in the scale of credit of commercial banks will influence the final effect of monetary'policy through the conduction of monetary policies,which will have a major impact on the national economy.From the perspective of domestic and foreign research.the degree of competition in the banking sector has a controversial effect on the effectiveness of monetary policy through credit channel transmission.No unified conclusion has been reached.Therefore.the study of the interaction between them has both theoretical and practical significance.This paper analyzes the impact of banking competition on the effect of monetary policy transmission based on bank credit channels.uses the Lerner index of listed commercial banks between 2007 and 2016 to measure the degree of market competition in China's banking sector.This paper also examines the impact of China's banking competition on the credit channels of monetary policy when the central bank regulates the economy.The empirical results show that:China's banking competition has significantly enhanced the effect of monetary policy in the credit channel.The impact of different types of commercial bank competition on the effect of monetary policy's credit channels is different.The competition of state-owned commercial banks has greater influence on the effect of credit channels than that of joint-stock commercial banks.Based on the above empirical analysis results,this paper concludes that China's banking competition has significantly improved the effect of monetary policy on credit channels.Therefore,in order to maximize the impact of competition among China's commercial banks on the effects of monetary policy transmission,the State should increase the level of competition in China's banking sector.and at the same time strictly regulate and standardize the commercial banks'competitive behavior,and promote competition in the banking sector.In particular,it is necessary to give full play to the influence of state-owned commercial banks on the effectiveness of monetary policies,increase the degree of competition of state-owned commercial banks,and dredge monetary policy credit transmission channels so that monetary policy can achieve optimal transmission effects through the improvement of banking competition.