Framing the Monetary Policy: Financializing the Targeting Framework of China's Central Bank

• In Event: 2323 - Student Forum Refereed Roundtable
  In Refereed Roundtable 100min: 8. Policy in a Global Context

Abstract

After the financial crisis of 2008, governors of People’s Bank of China (PBC) have continuously emphasized the transition of targeting framework from money supply to price level. Economists attribute such transition to advantages of price level targeting on the basis of economic models. I argue that such transition is the result of financialization in China that it shapes a financial framing in replacement of the original macroeconomic framing in making monetary policy. The topic modeling analysis of 32 quarterly monetary policy reports from PBC during 2010-2017 has confirmed that financial framing phrases have become more frequent and more prevalent throughout all topics, supporting the argument that financialization has created a financial framing in monetary policy making.

Author

• Yuemin Li, University at Albany, SUNY