The Choice between Monetary Policy Rules during Deposit Interest Rate Liberalization: Based on the Simulation and Analysis of DSGE

By building, calibrating and simulating a DSGE model including price stickiness and financial accelerator, with deposit interest rate liberalization in China, we analyze the effectiveness of different monetary policies from the three aspects of the macroeconomic fluctuations, the different effects of monetary policy shocks and the welfare loss function. The results show that, in the process of deposit interest rate liberalization, with deposit interest rate rising, the priced monetary policy instruments play more important part in decelerating economic fluctuations; the quantitative monetary policy instruments have an advantage in promoting the economic growth; for the welfare losses of representative families, when the interest rate level is below a certain value, the welfare loss based on the priced monetary policy is smaller.