Different Effects of Monetary Policy among Enterprises with Different Ownerships in China

Abstract

If the effects of a unified monetary policy are different on the enterprises with different ownerships, the difficulty for the central bank policy to control the monetary policy accurately will be enhanced, thus affect the effects of macro-control.Based on Vector Auto-Regression (VAR) model, this paper applied the impulse response function to empirically test the ultimate impact of China's monetary policy on the enterprises with different ownerships by EVIEWS statistical software. The results show that, under the unified monetary policy, there exists an obvious difference in the effects on the state-owned enterprises, foreign-funded enterprises and other non-state-owned enterprises. During the period of China's economic transition, enterprises with different ownerships are facing different market environment, which makes them have different constraints, thus the different monetary policy transmission mechanism mainly causes the formation of different monetary policy effects. In order to improve the effectiveness of monetary policy, in the long run, we should try better to promote the market-oriented reform of state-owned commercial banks and state-owned enterprises. In the short run, the flexibility of the monetary policy instruments and monetary policy regulation and control should be enhanced.