The Monetary Policy and The Exchange Rate Policy in China Index 1.The People's Bank of China 1.1 The history of The People's Bank of China 1.2 The role of The People's Bank of China 1.3 Internal departments 2.The Fiscal policy of china 3. The monetary policy of China 3.1 monetary policy 3.2 The Crisis over the last 10 years 3.3 independence of PBC 3.4 Taylor's rule in China 4. Comparison 4.1 Fed Reserve and ECB 4.2 Comparison of EU, US and China central banks and economies 5 The exchange rate policy of China 5.1 fixed exchange rate and floating exchange rate 5.2balance of international payments and capital mobility 5.3The policy ofChina 6 The future of CNY in the world arena 7.Can the CNY become a currency of international rank?
This paper investigates the empirical properties of simple interest rate rules that embed either "backward" or "forward" interest rate smoothing. Such interest rate rules can be rationalized as the operative reaction functions used by central banks pursuing monetary policy and financial stability targets. We explicitly consider the implications of banks' risk management practices for monetary policy and we derive interest rate rules by modeling the desire of the central bank to stabilize different definitions of the "basis" risk as a contribution to financial stability. ; This paper investigates the empirical properties of simple interest rate rules that embed either "backward" or "forward" interest rate smoothing. Such interest rate rules can be rationalized as the operative reaction functions used by central banks pursuing monetary policy and financial stability targets. We explicitly consider the implications of banks' risk management practices for monetary policy and we derive interest rate rules by modeling the desire of the central bank to stabilize different definitions of the "basis" risk as a contribution to financial stability. ; Invited Submissions
The profound changes brought about by the pandemic are affecting not only economic activity but also relative prices and, at least temporarily, inflation. These changes must be carefully examined by central banks, keeping in mind that the reaction of monetary policy to fluctuations in inflation is never automatic, but depends in a complex way on the nature of the shocks affecting the economy. In the current context, the Eurosystem will continue to provide the necessary support to the economy as long as the labour market remains weak and the degree of spare capacity remains high. When the time comes, the challenge for monetary policy will be to know how to apply the brakes correctly, without causing tensions, and still being ready to accelerate if it turns out to be necessary again. ; I profondi cambiamenti indotti dalla pandemia stanno investendo non solo l'attività economica ma anche i prezzi relativi e, almeno temporaneamente, l'inflazione. Tali cambiamenti devono essere valutati con molta attenzione dalle banche centrali, ricordando che la reazione della politica monetaria alle variazioni dell'inflazione non è mai automatica, ma dipende in modo complesso dalla natura degli shock che colpiscono l'economia. Nell'attuale contesto, l'Eurosistema continuerà a garantire il necessario supporto all'economia finché il mercato del lavoro resterà debole e il grado di capacità inutilizzata si manterrà elevato. Quando verrà il momento, la sfida per la politica monetaria sarà quella di saper correttamente tirare il freno, senza provocare tensioni e restando comunque pronta a premere di nuovo l'acceleratore qualora ciò tornasse necessario.
Nine years have passed from the explosion of the most severe financial crisis since the Great Depression, yet most European economies are stagnating if not sinking. Given the constraints on fiscal policies, the burden of restoring growth and employment has shifted from governments to the European Central Bank, which at first implemented a loose monetary policy by lowering short-term interest rates. Once the zero lower bound was attained, the ECB decided to purchase government securities and private bonds. The effects of such unconventional measures on investment, inflation and employment is what this Master's dissertation will assess. Post-keynesian economics will provide the main theoretical reference to better understand how central banks operate in a developed credit-based economy and how the economic environment is supposed to react. The mainstream view will be challenged by arguing that unconventional monetary policies such as the Quantitative Easing have no significant effects in increasing aggregate demand. It will be showed that asset purchasing programmes lead to perverse outcomes consisting in increasing financial instability via the substitution of safe with risky assets. At last, this encourages corporations in exploiting carry trade opportunities and accelerates the already worrisome dominance of the financial sector.
We work with a newly developed method to empirically assess whether a specified new-Keynesian business cycle monetary model estimated with U.S. quarterly data is consistent with a unique equilibrium or multiple equilibria under rational expectations. We conduct classical tests to verify if the structural model is correctly specified. Conditional on a positive answer, we formally assess if such model is either consistent with a unique equilibrium or with indeterminacy. Importantly, our full-system approach requires neither the use of prior distributions nor that of nonstandard inference. The case of an indeterminate equilibrium in the pre-1984 sample and of a determinate equilibrium in the post-1984 sample is favored by the data. The long-run coefficients on inflation and the output gap in the monetary policy rule are found to be weakly identified. However, our results are further supported by a proposed identification-robust indicator of indeterminacy.
This work aims to shed lights on a writer and politician of 18th century judged as a fool, a gambler and a swindler by his contemporaries but who nowadays may be considered instead one of the first monetary economists in the history of economic thought: John Law. Using the current stream of literature on this topic, as well as several other chronicles, this work will present the historical facts that brought John Law to become the financial minister of France in 1720 and to put in place a system, the Missisipi System, where he had the rare chance to translate his theories into economic policies, threatening the very foundations of the ancien régime. After elucidating the reasons of the collapse of the System, we will focus on the economic explanations of this failure, showing under which conditions Law's scheme could have been sustainable. A deep analysis of his early writings and of his later memoires will be carried on in order to assess the discrepancies between Law-"the economist" and Law-"the policy-maker". A further study will be conducted to inspect the reasons of Law's uncelebrated role in the subsequent history of economic thought and to present the modernity of his ideas regarding the nature and the role of money, with a particular attention to financial securities and paper and fiat money. The final part will build a singular parallel between Law's revolutionary experiment and Bitcoin, the most recent and influential attempt to reshape the current payment system, explaining both the similarities and the underlying economic differences.
