Research On Transmission Mechanism Of China's Unconventional Monetary Policy

Monetary policy has been the focus of economists' research for a long time,especially since 2008,Japan,the United States,the European Union,China and other economies have begun to implement different types of unconventional monetary policy,which has attracted wide attention of economists.Unconventional monetary policy and conventional monetary policy have different transmission mechanisms.Unconventional monetary policy affects the whole macro-economy by reducing the financial friction in the economy and then reducing the real investment interest rate.This paper constructs the dynamic stochastic general equilibrium model and the vector autoregression model respectively and studies the transmission mechanism of China's unconventional monetary policy from the theoretical and empirical aspects.The results of the dynamic stochastic general equilibrium model show that the implementation of the unconventional monetary policy increases the real return on investment,then the investment and the final output.This shows that the implementation of unconventional monetary policy helps to improve the macroeconomic environment and ultimately promote economic growth.At the same time,the implementation of unconventional monetary policy does not significantly reduce the short-term real interest rate in the economy,which shows that the model can well reflect the transmission mechanism of unconventional monetary policy.The results of vector autoregressive model show that the implementation of Standing Lending Facility can effectively promote investment,increase money and quasi money,but also reduce consumption and GDP in the long run;the implementation of Medium-term Lending Facility can effectively improve the investment environment in the market,promote the increase of investment,and increase the stock of money and quasi money in the economy.Although it has a restraining effect on consumption in the short term,it will slightly increase consumption and ultimately increase the output of the national economy in the long term,which plays a role in promoting economic growth.At the same time,the implementation of Standing Lending Facility and Medium-term Lending Facility will not lead to the decrease of short-term real interest rate,which reflects the transmission mechanism of unconventional monetary policy from an empirical perspective.