1. Introduction
2. Effectiveness Analysis of China’s Macro Control Policy
4. Empirical Results
In order to clarify the effectiveness of the macroeconomic regulation and control policy in the context of economic policy uncertainty, this paper analyzes the effectiveness of the macroeconomic regulation and control policy using China’s data from the second quarter of 2003 to the fourth quarter of 2017. TVP-VAR model and counterfactual analysis are used to study the effectiveness of price monetary policy and credit policy in regulating output and technological progress under uncertainty.
The results show that: under the uncertainty environment, the direction of price monetary policy on output has not changed, and the effect of interest rate rise on output is negative, and this impact is stronger in the short term than in the medium and long term. However, different from the results in the main literature, this paper finds that under the uncertainty environment, the effect of interest rate rise on technological progress is positive, and the effect intensity is also stronger in the short term, and weaker in the medium and long term. Under the uncertainty, the effect of interest rate change on output and technological progress is time-varying. Under the moderate uncertainty, the effect of price monetary policy on output is stronger. This implies that the degree of uncertainty of economic policy should be fully considered in the implementation of price oriented monetary policy to ensure the expected regulatory effect.
Credit growth can promote output growth, and the regulation effect of credit growth on output growth is mainly reflected in the short term. The effect of credit growth on output growth and technological progress is not time-varying. It is worth noting that the impact of credit growth on technological progress is not significant in the uncertain environment. Further research using the counterfactual analysis method shows that the uncertainty environment will reduce the regulation effect of credit policy on output growth, but the impact is not significant. Generally speaking, the impact of credit growth on technological progress is not significant.