Analysis on the industrial restructuring effect of China's monetary policy — Based on VAR model

There are some problems in Chinese economic structure, such as three- industries' development is not balance, too much high reliance on foreign trade, the contribution of consumption is relatively low and so on. By using vector auto regression (VAR) model and impulse response function, adopting the quarterly data from 1996 to 2010, this article analyses the industrial restructuring effect of monetary policy from two aspects. First, it shows that China's monetary Policy has indeed an obvious industrial effect among three-industries. Second, from a new perspective, the effects are also different between domestic demand and export. In order to adjust the industrial structure and to promote the domestic demand, China's government can implement differentiated monetary policy among different industries and different fields of economy.