An Empirical Study Of China's Monetary Policy Rules Based On The Nonlinear Phillips Curve Perspective

In recent years,China's economy has developed at a high speed,the price index has been rising,and inflationary pressures have continued to increase.At the same time,however,it has faced economic downturns,and the central bank has repeatedly lowered the reserve interest rate.The need for China to find an effective monetary policy institutional framework is imminent.Studying the micro-mechanism of non-linear monetary policy rules will help economic participants to predict the implementation of the monetary policy of the central bank,guide the public's reasonable expectations of the future economic situation,and improve the transparency of monetary policy implementation,thereby improving China's monetary policy.Controlling effects,reducing inflation,stabilizing output volatility,and promoting sustained economic growth provide the necessary foundation for scientific monetary policy.At the same time,this paper attempts to introduce the nonlinear Phillips curve as the constraint condition equivalent to the supply curve,and explore how China should implement the monetary policy rules to achieve the effect of controlling inflation.This paper first combs the linear and nonlinear monetary policy rules and the linear and nonlinear Phillips curves,and then clarifies the nonlinear Phillips curve as a constraint to study the theoretical basis of monetary policy rules;then the monthly inflation and production in 2013-2018 Out and interest rate data were used as research samples,and they were adjusted using X-12 seasonal adjustment method and HP filtering method.In order to investigate the nonlinear characteristics of the dynamic adjustment mechanism of inflation,a linear test is performed on the nonlinear smooth migration Phillips curve model.The simulated smooth migration transfer function form nonlinearizes the linear Phillips curve.At the same time,based on the nonlinear test of the Phillips curve,the convex features of the Phillips curve are identified.Finally,under the constraint condition of nonlinear smooth migration Phillips curve function,the bank loss function is combined to form the monetary policy rule framework and empirical research is carried out.Through analysis,the following conclusions are drawn:First,compared with the linear Phillips curve,the nonlinear Phillips curve has a higher degree of fitting with China's actual situation,and China's Phillips curve doesnot have convex characteristics;the inflation impact mechanism has dynamic and continuity.The output gap and inflation rate in the previous period will affect the inflation rate in the current period to some extent.Second,through the relationship between interest rate and inflation rate and output gap,it is found that the previous inflation rate and output gap are positively correlated with interest rate.The government responded according to the previous period data and made a reasonable prejudgment for the current inflation.Conduct accurate monetary policy implementation.Third,interest rates are a concave function of inflation rate,and the central bank has a tendency to circumvent deflation,indicating that the Chinese government is more inclined to short-term slight inflation.When the Chinese economy is in deflation,the central bank should focus on implementing monetary policy with reference to inflation data.