Real Interest Rates,Real Wages and Economic Restructuring—Analysis Based on Dynamic Stochastic General Equilibrium(DSGE)

On the basis of research conducted by Long and Plosser(1983),this paper carries out an in-depth analysis on the relationship between real interest rates,real wage,and macro-economy and economic structure by simulating a dynamic stochastic general equilibrium(DSGE) model and comes to the following conclusions:(1) Increasing the level of real interest rates will expand the share of consumption in GDP,improve the macroeconomic structure,and promote steady economic development;(2) Increasing the level of real wages will enhance economic growth but will not change the economic structure of consumption and investments;(3) Increasing wages will enhance economic growth and expand its share in national income;(4) Increasing wages will not lower output level but will be favorable to the improvement of economic structure.Therefore,this paper argues for interest rates liberalization to achieve long-term,steady economic development in China.

Global Economic Rebalancing： Fancy and Reality

＂Global economic imbalance＂ and ＂global economic rebalancing＂ have aroused great interest among international economic and.financial research circles. As the global financial crisis begins to abate, some Western countries have used ＂global economic rebalancing＂ as an excuse for trade protectionism and restricting the foreign economic development of developing nations. As the basic theoretical justification for the ＂global economic imbalance,＂ the theory of international trade equilibrium is wrong both in theory and in practice, because it has never been proven in the 200 years of history since the Industrial Revolution. ＂Global economic rebalancing＂ contains serious policy traps and does not generate any winners. The exchange rate is only one of the）actors which affect international trade;furthermore, it is not the fundamental mechanism. With the U.S. dollar retaining its status as the key currency of the international monetary system, it is impossible for the United States to achieve long-term foreign economic and trade equilibrium. The United States＇ trade deficit is an inevitable result of the dollar＇s status as an international currency.

CHINA’S ECONOMY IN THE 14TH FIVE-YEAR PLAN China must improve its capacity for innovation to elude the “middle-income trap”

The 14th Five-Year Plan period(2021-2025)represents the first five years after China’s completion of building a moderately prosperous society in all respects and the onset of a new journey to build a modern socialist country.Due in large part to the COVID-19 pandemic,the global economy has been floundering.Still,China’s 14th Five-Year Plan and Long-Range Objectives Through the Year 2035 will chart a course for development for the next five to 15 years,demonstrating China’s confidence in its role as an anchoring force amid global volatilities.And China has been sending a clear signal to the world that it is ready to work with any partners on future development.