HOW UNDERGROUND FINANCING IMPACTS MACROECONOMIC MOVEMENTS IN CHINA

Abstract

This paper looks at the scale of underground financing and analyzes its impact upon macroeconomic movements. After measuring the sizes of net underground financial investment, net flow of cross-border underground funds, underground money, underground loan, we judge the impact of these different underground financial indexes on economic equilibrium, growth and economic efficiency. Finally, we find a reasonable scale of underground financing and draw the conclusion that underground financing impacts and counteraction should be considered by government economic regulatory departments in setting macroeconomic policies.
Key words: Underground Financing, Scale Measurement, Macroeconomic Movements