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- All Subjects: Monetary Policy
- Creators: Schreindorfer, David
- Creators: Mendez, Jose
Description
This paper intends to examine topics related to Chinese financial policy and
institutions mainly in the early 21st century. China has gone through enormous changes in the late 20th century and early 21st century, and financial policy reforms and adjustments have been at times instrumental to aiding that growth, and at other times have served as impediments to the country’s success. As China’s clout has grown both economically and politically in the wider world, it has become evermore important to understand the Chinese financial system, particularly as other authoritarian regimes may seek to emulate it in the perhaps recent future. The paper will examine the institutional elements of Chinese finance, including the broader structure of the party state apparatus and the role of legislative and executive authorities in determining financial policy. Next, the paper will go through both the legal-regulatory environment of the country and the structure of the preeminent Chinese banks. Finally, issues in Chinese monetary policy, particularly exchange rate system reforms, and the developing stock and bond markets will be addressed.
institutions mainly in the early 21st century. China has gone through enormous changes in the late 20th century and early 21st century, and financial policy reforms and adjustments have been at times instrumental to aiding that growth, and at other times have served as impediments to the country’s success. As China’s clout has grown both economically and politically in the wider world, it has become evermore important to understand the Chinese financial system, particularly as other authoritarian regimes may seek to emulate it in the perhaps recent future. The paper will examine the institutional elements of Chinese finance, including the broader structure of the party state apparatus and the role of legislative and executive authorities in determining financial policy. Next, the paper will go through both the legal-regulatory environment of the country and the structure of the preeminent Chinese banks. Finally, issues in Chinese monetary policy, particularly exchange rate system reforms, and the developing stock and bond markets will be addressed.
ContributorsFeatherston, Ryan (Author) / Hill, John (Thesis director) / Mendez, Jose (Committee member) / Department of Economics (Contributor) / Dean, W.P. Carey School of Business (Contributor) / Barrett, The Honors College (Contributor)
Created2019-05
Description
My project has been a long journey, one that I have learned a tremendous amount on. The final version of my project has come out to be a booklet teaching first time users of code and python the basic steps of getting started and some vital information that I learned while I was learning the language. I started my thesis with the idea of creating a portfolio of stock, bonds and commodities to determine the best allocation of your money over a 30-year period. To do this, I needed to learn how to code and become proficient quickly so I could create a program that would be powerful enough as well as spit out the correct output in the end. Unfortunately, I fell short of being able to build this portfolio out. I took on the challenge of learning Python on my own with no knowledge of any coding language to see if I could pull the whole project together. I failed, but I learned so much along the way and that I think is more valuable than anything. Since I was unable to complete my code, I shifted my attention to creating a small booklet on the basics of getting started in Python as if you have never looked at a coding language. Many of the tips I discuss in my booklet are problems I struggled with when I began. In the beginning I couldn’t even figure out how to get to a coding platform to begin my work, so I began to research and found many helpful tips that took me quite a while to understand.
ContributorsToumbs, Jason David (Author) / Boguth, Oliver (Thesis director) / Schreindorfer, David (Committee member) / Department of Finance (Contributor, Contributor) / Barrett, The Honors College (Contributor)
Created2019-05
Description
This dissertation consists of three essays studying the relationship between corporate finance and monetary policy and macroeconomics. In the first essay, I provide novel estimations of the monetary policy’s working capital channel size by estimating a dynamic stochastic macro-finance model using firm-level data. In aggregate, I find a partial channel —about three-fourths of firms’ labor bill is borrowed. But the strength of this channel varies across industries, reaching as low as one-half for retail firms and as high as one for agriculture and construction. These results provide evidence that monetary policy could have varying effects across industries through the working capital channel. In the second essay, I study the effects of the Unconventional Monetary Policy (UMP) of purchasing corporate bonds on firms’ decisions in the COVID-19 crisis. Specifically, I develop a theoretical model which predicts that the firm’s default probability plays a crucial role in transmitting the effects of COVID-19 shock and the UMP. Using the model to evaluate two kinds of heterogeneities (size and initial credit risk), I show that large firms and high-risk firms are more affected by COVID-19 shock and are more responsive to the UMP. I then run cross-sectional regressions, whose results support the theoretical predictions suggesting that the firm’s characteristics, such as assets and operating income, are relevant to understanding the UMP effects. In the third essay, I document that capital utilization and short-term debt are procyclical. I show that a strong positive relationship exists at the aggregate and firm levels. It persists even when I control the regressions for firm size, profits, growth, and business cycle effects. In addition, the Dynamic Stochastic General Equilibrium (DSGE) model shows that in the presence of capital utilization, positive real and financial shocks cause the firm to change its financing of the equity payout policy from earnings to debt, increasing short-term debt.
ContributorsGalindo Gil, Hamilton (Author) / Pruitt, Seth (Thesis advisor) / Schreindorfer, David (Thesis advisor) / Bessembinder, Hendrik (Committee member) / Mehra, Rajnish (Committee member) / Arizona State University (Publisher)
Created2022