Abstract:

In recent years, the decrease of the household saving rate and the continuous prosperity of the real estate industry have promoted the increase of the household leverage ratio in China. As China's household sector leverage rate is significantly higher than those of most emerging economies, the increase of the pressure on household debt has more obvious inhibition on the consumption, especially when China's total retail sales of social consumer goods in 2018 grew at the lowest rate since the year 2015. The role of consumption in driving the economy and the role of fiscal policy in stimulating investment are gradually weakening.
The crowding-out effect of fiscal policy, or constraints on borrowing of the household sector has depressed consumption. How to effectively control the rapid rise of the leverage ratio of the household sector and how to promote consumption to stabilize economic growth have become a hot issue of domestic concern. In this regard, our government departments have adopted a series of financial policies and achieved positive results.
There are two main effects of fiscal policy. One is the crowding out effect. As a result, the actual investment of the household sector decreases which squeezes out part of the investment and consumption of the household sector, leading to the increase of capital accumulation and savings, and the decrease of output level. Meanwhile, the other one is the output effect. For example, issuing more national debt, structural tax reduction and raising the tax starting point can stimulate enterprise output more directly and effectively than the transmission mechanism of monetary policy, and the mechanism of automatic stabilizer can smooth out the fluctuations of the economic cycle in a shorter period of time. Based on macroeconomic data from 1981 to 2018, this paper constructs a real business cycle model that includes household borrowing constraints and government spending shocks. Taking government expenditure as an exogenous random impact variable, this paper conducts an empirical test on the economic characteristics of China after the reform and opening up, in order to examine the effect of fiscal expenditure, the sensitivity of household borrowing constraints and the cyclical characteristics of macroeconomic fluctuations.
The innovation and contribution of this paper based on the existing literature are as follows. First, we try to introduce the household borrowing constraint and government expenditure into a real business cycle model at the same time, and then study the internal relationship between the government spending shock and economic fluctuations when the household is faced with the borrowing constraint by constructing an economic model involving government departments. Second, we provide detailed instructions to model parameter calibration, most of which are calibrated with the actual economic data using the methods of linear regression model. A small number of model parameters are taken from the literature, which enables the model to give more persuasive explanation of economic fluctuations, while some of the important parameters are calibrated within the model and can be used as a reference for the follow-up studies.
The main conclusions of this paper are as follows: First, by adjusting the fiscal expenditure impact parameters, it shows that China's fiscal expenditure has a certain crowding out effect on private investment and consumption, while the output effect is stronger than the crowding out effect. Second, the stronger the household sector is constrained by borrowing, the weaker the positive impact of fiscal expenditure shock on effective consumption and debt level would be, that is, the more inclined it is to reduce leverage ratio according to the adjustment of borrowing constraint parameters. At the present stage, the government's fiscal expenditure should strengthen the construction of public infrastructure in order to reduce the crowding out of private investment and consumption. The household and business sectors should be subject to relatively strong borrowing constraints and coupled with a prudent monetary policy and a proactive fiscal policy, to avoid triggering the risk of “debt-deflation” and falling into the Ponzi game.

Key words: Loan Constraint, Fiscal Expenditure Shock, Economic Fluctuation, Crowding-out Effect

摘要：

本文基于1981~2018年宏观经济数据,构建了一个包括家庭借贷约束与政府支出冲击的真实商业周期模型。在该模型中,本文将政府支出作为外生随机冲击变量,对改革开放后的中国经济特征进行了实证检验,以考察我国财政支出的效应、家庭借贷约束的敏感性以及宏观经济波动的周期特征。研究发现:第一,调整财政支出冲击参数的结果显示,我国财政支出对私人投资和消费具有一定的挤出效应,但产出效应强于挤出效应;第二,调整借贷约束参数的结果显示,家庭部门受到的借贷约束越强,财政支出冲击对有效消费和债务水平的正向影响会越弱,即越倾向于降低家庭杠杆率。因此,本文认为现阶段政府财政支出应加强公共基础设施建设,以减少对私人投资和消费的挤出;政府应给予家庭和企业部门相对较强的借贷约束,同时配合以稳健的货币政策和积极的财政政策,避免触发“债务-通缩”风险而陷入蓬齐博弈。

关键词: 借贷约束, 财政支出冲击, 经济波动, 挤出效应