Balance on Monetary Policy and Macroprudential Policy
Economics
Volume 9, Issue 2, June 2020, Pages: 27-39
Received: Nov. 19, 2019; Accepted: Dec. 5, 2019; Published: Jun. 17, 2020
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Authors
Zhi Junli, Institute of Chinese Financial Studies, Southwestern University of Finance and Economics, Chengdu, China
Zeng Kanglin, Institute of Chinese Financial Studies, Southwestern University of Finance and Economics, Chengdu, China
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Abstract
Monetary policy is based on the theoretical rationale of the insufficient effective demand. The mainly logical difference between Keynes and Friedman are what domain interest rate directly and which factor will offset the effect of interest rate. The empirical application of monetary policy has several aspects deserving study: (1) the target, range, strength and effect of its monetary policy, (2) the theoretical development of Western monetary policy transmission, (3) monetary transmission channel in China, (4) the difference effect of monetary policy. The aggregate financing to real economy is China’s innovation to monetary policy. The background of macroprudential policy is financial crisis, its theoretical backup and application in real world including situation analysis, taking countermeasures, and tools application. By practical experience of China, the systematic financial risk lies on the unhealthy condition of most financial institute. The stock market crisis in 2015 is a reflection of systematic financial risk. Therefore, we should focus our attention on the special mechanism of financial risk and financial cycle in background of socialist political system with Chinese characteristics. We also should study liquidity condition by the central bank qualitatively and quantitatively.
Keywords
Monetary Policy, Macroprudential Policy, Excess Liquidity
To cite this article
Zhi Junli, Zeng Kanglin, Balance on Monetary Policy and Macroprudential Policy, Economics. Vol. 9, No. 2, 2020, pp. 27-39. doi: 10.11648/j.eco.20200902.12
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Copyright © 2020 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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