The Study on Financial Accelerator Action Mechanism in China’s Macroeconomic Fluctuation
|Keywords||Financial Accelerator Economic Flutuation DSGE Model Credit Market Action Memchanism|
Understanding economic fluctuation causes, mechanism and its persistence is always the important content in the research of macroscopical economy. With the development of financial market, financial factors on the macroeconomic impact of more and more profound, ignored the financial market in economic fluctuation is not reasonable. Credit market as an important part of the financial market, it will change the economic fluctuation influence. Because of the information asymmetry of credit market, credit supply and demand environment changes directly affect the external finance premium level of enterprise, which led to investment and consumption fluctuations, ultimately produces to economic fluctuation effect. This paper on the financial accelerator action mechanism research in China’s macroeconomic fluctuations, is to make clear as a result of the credit market with asymmetric information, agency cost caused by both lenders and borrowers, assets and liabilities of enterprises, enterprise investment and production changes, in the" financial accelerator" action eventually led to greater economic fluctuation. In this paper on the basis of the domestic and foreign scholars’research, combined with China’s actual situation, on China’s macroeconomic fluctuations in financial accelerator action mechanism for system analysis and inspection, to try out for the financial accelerator in macroscopical economy analysis and effective application, provided support for the theory and empirical evidence.The paper is divided into seven chapters; the concrete structure arrangement and conclusion are as follows:Chapter 1, the financial accelerator theory and the empirical literature review. This chapter reviews the financial accelerator theory and empirical literature and gives some comments. First defines the financial accelerator, next to review the financial accelerator mechanism research literatures, and then to the financial accelerator empirical studies. Finally, this paper summarizes the existing research and gives some comments.Chapter 2, the financial accelerator action mechanism research and model constructed. This chapter studies the financial accelerator effect mechanism, and puts forward the basic model. First ly, based on the credit market friction existence condition, from enterprise development finance requirement of net value is around enterprise to economic relations between the financial accelerator in generating mechanism; Secondly, this paper analyzes the existing financial accelerator theory model, and found that DSGE model for the policy analysis have outstanding performance and obtained fast development, which has been widely used in the financial accelerator relevant empirical research; Thirdly, introducing the basic DSGE model included the financial accelerator; Finally, in order to meet the need of this empirical study, respectively from the sticky condition, the banking sector, open conditions and exchange rate system to expand the basic DSGE model.Chapter 3, studies the financial accelerator action mechanism under different sticky condition. This chapter from the perspective of credit demand, namely enterprise external financing requirements under different sticky condition to study the financial accelerator action mechanism. Firstly, defines "sticky" and characterizations that equation; Secondly, combined with the empirical data to study the financial accelerator effect under different "sticky" conditions, and system analyse the results; finally, analyses the financial accelerator action mechanism under different "sticky" conditions.The results found that sticky size has an important influence on the financial accelerator size, namely the sticky is bigger, the financial accelerator effect on smaller, exogenous shocks on the financial accelerator effect is smaller, and the influence of economic fluctuation is smaller. In addition, the financial accelerator has to strengthen the demand for exogenous shocks contribute, and inhibition the supply for exogenous shocks contributions, namely investment efficiency impact to the economic variable fluctuations have been reduced, consumer preference impact to the economic variable fluctuations have been enhanced. But in different sticky conditions, the financial accelerator on the economic impact of magnification with obvious difference, compared tor fully elastic condition, financial accelerator effect has been offseted somewhat under sticky conditions; especially under dynamics sticky price, the financial accelerator effect has been offseted more obvious.Chapter 4, studies the financial accelerator action mechanism considering the influence of the banking sector. This chapter studies the financial accelerator action mechanism from the perspective of credit supply-banking sector. Firstly, analyse bank sector action mechanism included the financial; Secondly, combined with the empirical data to test the banking sector influenct to the financial accelerator effects, and and system analyse the results; finally, the paper analyses the financial accelerator action mechanism including the banking sector.The results found that credit supply has diminished demand shock, such as consumer preferences and monetary demand shocks on economic variables impact; substantially increased the supply shocks, such as investment efficiency and impact of technology on the impact of economic variables. This conclusion is diametrically opposite to simple credit demand of financial accelerator action mechanism:the financial accelerator has to strengthen the demand for exogenous shocks contribute, and inhibition the supply for exogenous shocks contributions, namely investment efficiency impact to the economic variable fluctuations have been reduced, consumer preference impact to the economic variable fluctuations have been enhanced. This shows that the supply of credit relaxation state changes to the financial accelerator action mechanism has an important influence, the conclusion is also available from the risk of default, adjustment cost, interest rate stickiness and interbank lending ratio of four parameters change was further confirmed, namely when the supply of credit easing, financial accelerator effect obviously, enlarge the investment efficiency and currency demand shock to economic variables, and vice versa.Chapter 5, studies the financial accelerator action mechanism including opening environment. This chapter studies the financial accelerator action mechanism from the perspective of external economic. Firstly, combed the economic development of the typical open fact in China; Secondly, based on the open economic environment DSGE model and combining with the Chinese economic data system study the opening affect the financial accelerator effects; Finally, studies the financial accelerator action mechanism under the open economic conditions. The results found that the financial accelerator on impact of demand and supply shocks have significant amplification effect under economic opening. The impact of investment efficiency, foreign interest rate shock, technology shock and exchange rate impact become the main impact source to economic fluctuations, their impact contribution amounts to 90%. In addition, when the external economic participation improve, enhance the external economy supply shock (foreign interest rate, exchange rate) to economic fluctuations, weaken the internal economy supply shock (investment efficiency impact) to economic fluctuations.Chapter 6, studies the financial accelerator action mechanism under different exchange rate system condition. This chapter studies the financial accelerator action mechanism from the perspective of different exchange rate system. Firstly, analyzes the exchange rate mechanism including the financial accelerator; secondly, studies the fixed exchange rate and the floating exchange rate affect the financial accelerator effects; finally, studies the financial accelerator action mechanism under the different exchange rate system conditions. The results found that in the different exchange rate system, are exacerbated by exogenous shocks to economic fluctuation. But the difference is:the impact caused by external economy on economic fluctuation is more significant under the the floating exchange rate system, such as the foreign interest rate and exchange rate shock to economic fluctuation contributed more than 30%, with imports, input inflation level up, the impact caused by external economy on economic fluctuation influence increase; the fixed exchange rate system, external economy cause impact to economic fluctuations do not directly reflect, ultimately for the performance of the investment efficiency and technology shock to economic fluctuations, with imports increase, enhance the efficiency of investment shock to economic fluctuations, reduce technology shcok to economic fluctuations, but with the input inflation level increase, exogenous shocks to economic fluctuation impact not changed.Chapter 7, policy suggestions. In the earlier research foundation, this chapter from the perspective of the financial accelerator put forward the policy implications to restrain the economic fluctuations. First, improve the quality of capital formation, in order to improve the efficiency of investment; Second, promote the capital market, and actively expand direct financing channel; Third, promoting financial innovation, establish and perfect the price discovery mechanism; Fourth, establish consumer financial system, optimize the loan fund flow; Fifth, steadily promoting "double rate" reform, give full play to the role of economic regulation.