Attempting to build a function of currency substitution combined with the background of China, it will give an empirical study of the degree and the effect of c.

An Empirical Research on the Relation between RMB Exchange Rate and Currency Substitution;

An Empirical Analysis on the Exchange Rate Determination Model Based on Currency Substitution;

Control RMB Exchange Rate Reform Properly: A Behavioral Economics Analysis Based on Currency Substitution in China;

The main purpose of the paper is to test whether there is money substitution in the period of managed floating exchange rate in China by introducing Johansen (1988,1989) cointegration approach.

Based on currency anti-substitution perspective on China’s high M2/GDP abnormal analysis and empirical testing, research results show that: under the current foreign exchange management system, high foreign exchange reserves and the ineffective offsetting mechanism are the main causes leading to M2/GDP increase.

At present,RMB internationalization has a lot of benefits,but at the same time it faces the currency substitution risk,RMB internationalization of risk reversal,the impact of foreign capital and currency anti-substitution risks.