Capital Account Opening,institutional Quality And Currency Internationalization

In this paper,SGMM method is adopted to introduce institutional quality index in the research,to explore the impact of capital account opening on currency internationalization,and to provide Suggestions for RMB internationalization.The empirical results show that: first,open the capital account may have a negative impact on monetary internationalization,but as the system of quality improvement,capital account liberalization impact on monetary internationalization gradually to promote the role,and by improving the institutional environment,to promote the country’s economic system impact resistant ability,promote foreign investors to the country’s currency holdings will,give full play to the functions of international currency reserves;Secondly,the impact of different types of capital account liberalization on currency internationalization is obviously heterogeneous.Direct investment liberalization will have a negative impact on currency internationalization,and the improvement of institutional quality will help weaken the negative impact of direct investment liberalization on currency internationalization.The opening up of securities investment is conducive to the promotion of internationalization level,but the effect is not significant,and the positive impact will weaken with the improvement of system quality.The level of financial derivatives liberalization has no significant influence on the level of currency internationalization.Finally,when the system quality index is refined,only the legal system quality is significant.Non-economic factors such as military strength and scientific and technological development level play an important role in promoting currency internationalization.In the process of promoting the internationalization of RMB,China has continuously strengthened the construction of relevant domestic legal systems,cautiously treated the opening of capital account,prudently opened different types of capital projects,and promoted the in-depth development of the financial market.