It Is Possible For Short-Term Macroeconomic Policy To Relax Moderately.

Supply side policy and demand side policy, I do not think there is the question of who wins, these two aspects are very important.

In fact, most demand side policies are mainly macroeconomic policies and short-term policies. In fact, most of them are balancing the economy.

The supply side reform will give more consideration to how to achieve effective allocation of resources, sustainable productivity improvement and technological progress, so it may be a more long-term policy.

Some economists believe that the central government's reform of supply side means that the idea of "stimulating economic growth by stimulating investment demand" has changed, and monetary policy will be relatively contractile.

This statement is groundless.

Happening globally

There is no point in discussing the supply side policy. What we need is counter cyclical and stable macroeconomic policies. But now we are entering a new stage. We are considering whether China's economy can continue to grow for five years, ten years or even longer. At this time, it is meaningful to consider the supply side policy.

First of all, monetary policy is not particularly loose, and the current monetary policy has been steady.

Secondly, these two problems are not in the same dimension.

Monetary policy and fiscal policy are used to solve short-term stability problems, such as the pressure of economic downfall is too large, and monetary and fiscal policies are used for short-term underpinning of the economy.

The policy of supply side is usually used to solve the sustainability problem of medium and long term growth.

However, with the emphasis on the structural reform of supply side, it is indeed a possibility to postpone monetary policy and fiscal policy, and the other possibility is to push forward the supply side reform.

For example, some industries need

This means that the downward pressure on economic growth may increase further in the short term, because some enterprises need to be shut down artificially, so there are no jobs and production.

Of course, these production and employment are ineffective.

But even so, if they are shut down, economic activities will become less.

At this point, in order to coordinate reforms and achieve a smooth economic pition, it is also possible to relax the short-term macroeconomic policy moderately.

Two years ago, after the reform plan (the the third Plenary Session of the 18th CPC Central Committee decision of the party) came out, IMF (International Monetary Fund) once made a calculation and found that if all policies were fully implemented, it would be beneficial to long-term economic growth the potential of China's economic growth could be increased by two percentage points.

But it also found that in the short term, this reform would reduce economic growth by 0.3 percentage points.

That is to say, adjustment and reorganization will result in loss of economic activities in the short term.

Therefore, economic structural reform, including structural reform of supply side, is generally the coordination between reform policies (such as shutting down "zombie state-owned enterprises") and macro policies. It is a multi-level, multi-dimensional rather than a simple aspect.