By Chen Daofu, Research Institute of Finance, DRC

Research Report, No.220, 2020 (Total 5964) 2020-9-10

Abstract: Macroeconomic-control is a correction to the spontaneous forces of the market. It is a way for the government departments to adjust the economic operation and structure through various policy tools, so as to make them perform properly with expected results. Cross-cycle design and adjustment of macroeconomic-control emphasize the construction of institutions and mechanisms, especially the automatic stabilizing mechanism and long-term mechanism; focus on the adjustment of economic growth trend and the potential growth rate; tap the forces and tools to “cross” the cycle; and enable the realization of the economic “cross-cycle” process in the “transitional period” amid great pattern and structure changes. China’s macroeconomic-control framework bears cross-cycle features. We need to create a sound macroeconomic-environment for the Central Government to make strategic options. We need to distinguish between reform, macroeconomic-control and risk management, adapt to multi-objective management’s target selection and regulation framework selection mechanism, improve the automatic stabilizing function of financial sector and State-owned enterprises, and strengthen policy coordination during the transitional period.

Keywords: macroeconomic-control, cross-cycle design and adjustment, counter-cyclical regulation