Macroeconomic policy coordination and its influence on systemic risk and economic growth: evidence from China

We examine the coordinated effects of fiscal, monetary, and macroprudential policies in the context of China’s macroeconomic regulation and financial risk management. Using a structural empirical framework, we assess the dynamic impacts of these policy tools on systemic risk and economic growth. The results show that all three policy types play a significant role in mitigating systemic risk while supporting economic growth. Further evidence suggests heterogeneity in policy effectiveness across different instruments and economic conditions. Variance decomposition indicates that macroprudential policy accounts for the largest share of fluctuations in systemic risk. The results highlight the importance of policy coordination for financial stability and sustainable growth.
This study examines the dynamic coordinated effects of fiscal, monetary, and macroprudential policies on systemic risk and economic growth within the context of macroeconomic regulation and financial risk management, using a structural empirical framework. The findings indicate that all three policy types effectively mitigate risk while supporting growth, though policy effectiveness varies across tools and economic conditions. Notably, macroprudential policy contributes the most to fluctuations in systemic risk. Research Significance: The results highlight the critical role of policy coordination in maintaining financial stability and achieving sustainable growth, providing empirical support for the combined application and optimization of multiple policy instruments.