China’s Monetary and Macroprudential Policies: Are They Complementary or Substitutive?
| Autor: | Lixin Sun, Peter Sinclair |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Economics and Econometrics
050208 finance Reserve requirement Financial stability media_common.quotation_subject 05 social sciences Geography Planning and Development Monetary policy Monetary economics Interest rate Central bank 0502 economics and business Economics Dynamic stochastic general equilibrium 050207 economics Price of stability China media_common |
| Zdroj: | CESifo Economic Studies. 67:186-209 |
| ISSN: | 1612-7501 1610-241X |
| DOI: | 10.1093/cesifo/ifaa016 |
| Popis: | This paper develops a calibrated dynamic stochastic general equilibrium model incorporating a banking sector and some unique features of China’s macroeconomic policies to simulate China’s monetary and macroprudential policies. The quantitative results show, first, that the interest rate is a better instrument for China’s monetary policy than the required reserve ratio (RRR) when the central bank is solely concerned about price stability; second, that the loan-to-value ratio is a very useful macroprudential tool for China’s financial stability, and the RRR could be used as an instrument for both objectives; third, monetary and macroprudential policies could be either complements or substitutes in China, depending on the choices of instruments for the two policies. Our policy experiments recommend three combination choices of instruments for China’s monetary and macroprudential policies. (JEL codes: E52, E61and G18) |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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