Title: On the Current Exchange Rate Policy in China──Also on the Problem of whether the Renminbi should Be Devaluated
Abstract: The basic reason for the current problem of deflation and lack of aggregate demand is the obstruction occurred in process of aggregate demand. Therefore, the effects of fiscal and monetary policies of expanding expenditures that based on expanding domestic demand are limited. The deepening of China's economic reform needs a relatively higher speed of economic growth, in the circumstances that the domestic demand being difficult to start up, such a goal can only be reached through expanding foreign demand, i. e. the pure export. The exchange rate policy therefore becomes the optimal choice. Research made by this paper shows that the contribution of Renminbi's exchange rate changes to economic growth is very high. The deflation of Renminbi is both necessary and feasible.
Publication Year: 2000
Publication Date: 2000-01-01
Language: en
Type: article
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