Department Chair

Frederick Floss


Rui QinFollow

Date of Award


Access Control

Open Access

Degree Name

Applied Economics, M.A.


Economics and Finance Department


XingWang Qian

Department Home page

First Reader

XingWang Qian

Second Reader

Theodore Byrley

Third Reader

Frederick Floss


The purpose of this paper is to study the electronic money's influence on the money supply as well as the power of the central bank. We show in an illustrative theoretical model that electronic money will impact on money supply, especially affect M0 and M1. Using data of central bank in China during 1990 to 2010 and applying ordinary least squares (OLS) regression models, we find robust evidence that electronic money has a negative impact on M0, but a positive impact on M1. In addition, the central bank's abilities to control money supply can be affected by the wide application of electronic money. Further, these results could help central banks and financial institutions predict the economics environment and take necessary actions, eliminate these influences and reinforce the stability of money markets.