Does Internet Finance Impact the Effectiveness of China's Monetary Policies?
Abstract
The rapid development of the world's financial industry today is due to the development of Internet technology, and monetary policy has been continuously optimized with its rapid development. As a new field of China in the 21st century, Internet finance, with its characteristics of convenience, efficiency, information and attention to the experience of network users, provides people with very convenient and fast financial services and diversified financial products, and meets the demand of "long tail market" which is not valued by traditional finance. At the same time, although the rapid development of Internet finance accelerates financial disintermediation to a certain extent, it also affects the traditional monetary creation process, which makes the people's Bank of China's ability to control the money supply weaken, and the effectiveness of monetary policy is also affected to a certain extent. By describing the influence of Internet finance on the effectiveness of monetary policy, taking Yu' e Bao's seven-day annualized rate of return as the representative, taking the interbank lending rate and the total money supply as variables to represent different types of monetary policy, this paper makes an empirical study on the selected topics through the establishment of VEC model, analyzes the influence of the two effects, and concludes that: first one is Internet finance has a long-term negative impact on the interbank lending rate, forcing banks to lower the lending rate; The second is Internet finance will have a certain impact on the money supply, but not stable and low intensity. Finally, it is suggested that China should pay more attention to the role of interest rate transmission channels; give full play to the role of reloan and rediscount; strengthen the ability of the legal deposit reserve policy to regulate the amount of money supply; classify supervision, clarify the supervision responsibility of Internet finance, and strengthen supervision.
