Monetary Policy and Common Prosperity:The Moderating Effect of Digital Finance
The realization of common prosperity is the essential requirement of socialism with Chinese characteristics.This paper aims to study the role of loose monetary policy in the process of achieving common prosperity,and explore the important role of digital finance in this process.Firstly,by constructing a theoretical model,this paper analyzes the determinants of loose monetary policy affecting common prosperity,and then explores the mechanism of digital finance development on the effect of monetary policy.Secondly,this paper attempts to construct a common prosperity index system from the three dimensions of affluence degree,sharing degree and sustainability,and uses the equal weight method and entropy method to calculate the common prosperity composite index.Finally,a panel econometric model is established to empirically test the correlation between monetary policy and common prosperity using Chinese Family Panel Studies (CFPS) data,and the moderating effect of digital finance on the impact of loose monetary policy on common prosperity is mainly analyzed.We find that loose monetary policy improves the level of common prosperity of households,but the current development of digital finance weakens this effect.Further analysis shows that the weakening effect of digital finance has obvious regional,channel and information heterogeneity.
monetary policydigital financecommon prosperityincome gap
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