Macroeconomic Policy Adjustments on Environmental Protection Effectiveness Research - Based on the DSGE Model

Abstract

Through the dynamic stochastic general equilibrium model (DSGE model), this article explores the balance between economic development and environmental protection, focusing on the in-depth mutual influence among economic agents such as households, banks, producers, and government in promoting economic growth and achieving environmental protection. The model comprehensively considers factors such as production technology, carbon tax policies, bank loan rates, and government fiscal policies, aiming to analyze the specific impacts of these factors on economic growth, environmental protection, and social welfare. By detailed settings and analysis of consumption, savings, and labor supply decisions of households, the financial intermediary role of the banking sector, and carbon emissions and environmental technology use in the production sector, this study provides theoretical support for an environmentally friendly economic growth path. Through policy analysis, this article reveals the short-term and long-term effects of positive technological shocks, taxation on energy firms' loan rates, carbon tax policies, and government spending on the economy and the environment, providing a theoretical basis and reference for formulating relevant economic and environmental policies. The results indicate that appropriate macroeconomic policies can effectively promote economic growth while reducing carbon emissions and enhancing social welfare.