Faced with the fact that China's economy is in the down period and financial risks continue to rise in recent years, the central bank, the China Banking Regulatory Commission(CBRC) and so on have put forward firmly that systemic financial risks should be prevented as the bottom line. It is common practice to guard against risks with financial policies, but there may be inconsistency between multiple financial policies. By constructing a dynamic stochastic general equilibrium model, this paper conducts the comparative analysis and arrives at the following results:firstly, under the requirement of capital supervision, the measures of weakening liquidity intervention, such as the cancelation of the loan-to-deposit ratio constraint or the implicit government guarantee of the inter-bank market, play a countercyclical adjustment role to some extent; secondly, in the view of mitigating the pro-cyclicality of capital regulation when the economic and financial sectors suffer from exogenous shocks of various negative impacts, the measure to eliminate the implicit government guarantee is more robust. So it suggests that the effects of different bank liquidity intervention policies on macro prudential attribute of capital supervision should be paid to attention and the role of capital supervision in preventing systemic financial risks could be strengthened through the compatibility among policies. This paper is of great significance to the evaluation of current policy effects and the improvement of the effectiveness of financial policies in China.
Systemic Risk Prevention and Multiple Financial Policy Coordination:Analysis of Countercyclical Regulatory Effect Based on DSGE Model
Journal of Finance and Economics Vol. 43, Issue 07, pp. 57 - 69 (2017) DOI:10.16538/j.cnki.jfe.2017.07.005
Cite this article
Tian Jiao, Wang Qing. Systemic Risk Prevention and Multiple Financial Policy Coordination:Analysis of Countercyclical Regulatory Effect Based on DSGE Model[J]. Journal of Finance and Economics, 2017, 43(7): 57–69.
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