We study household financial choices in China and compare them with those in the US. We estimate a structural model where the two countries differ in terms of preferences and institutional arrangements. In the structural estimation, we take into account the effects of important structural changes in the Chinese economy between 1990-2000.
With over twenty years of experience at the frontline of China’s monetary policy operations and with two decades of academic research experience, I provide a unique, first-hand perspective on a number of facets dealing with China’s monetary policy and theory. The book opens with an introduction of monetary theories, including my credit monetary theory, followed by a review of some focal issues regarding China’s monetary policy and a discussion of the RMB exchange rate regime and international balance. The book presents China as a country at a crossroads, forced to choose between the free flow of capital and monetary policy independence.