Yulu, Chen and Yong, Ma and Ke, Tang (2011): The chinese financial system at the Dawn of the 21st century: An Overview. Published in: Aestimatio. The IEB International Journal of Finance No. 2 (July 2011): pp. 1-40.
Download (2MB) | Preview
Based on a systematic review and summarization of China’s 30 years of financial reform and development, this paper comprehensively analyzes the past, present and future development of China’s financial system and also presents the mechanism for China’s financial development from the view of political economics. Generally, the Chinese financial system is bank-oriented. The property rights structure, led by state-owned banks, is the prominent feature of the Chinese banking system. Equity, bond, money, currency and real estate markets have been developing rapidly; however, the development rate of these markets varies, and institutional construction generally falls behind the market development. China’s financial decision-making authority belongs to the State Council, and the financial supervision system adopts the mode of “separate regulation.” China’s state-driven, progressive financial reforms have promoted the formation of the government-led financial structure, which is composed of three parts: first, monetary policy, balancing both inflation control and economic growth; second, bank credit expansion under the implicit guarantee of the state; and third, the adjustable pegged exchange rate system based on capital controls. The next phase of financial reform in China will mainly focus on the following four key goals: first, to further improve the corporate governance and the mixed operation of financial institutions; second, to construct the institution of a financial market system and improve the effectiveness of the financial markets; third, to re-integrate regulatory resources, combine macro- and micro-prudent views, and establish a comprehensive framework for financial stability; fourth, to promote the liberalization of interest rates, marketization of the exchange rate and the opening of capital accounts based on a progressive approach and to improve the openness of the financial system based on macroeconomic stability.
|Item Type:||MPRA Paper|
|Original Title:||The chinese financial system at the Dawn of the 21st century: An Overview|
|English Title:||The chinese financial system at the Dawn of the 21st century: An Overview|
|Keywords:||China, Financial System, Bank-oriented, Political Economics|
|Subjects:||K - Law and Economics > K0 - General
G - Financial Economics > G2 - Financial Institutions and Services
O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies
|Depositing User:||IEB Research Department|
|Date Deposited:||18. Jan 2012 16:52|
|Last Modified:||21. Nov 2015 08:30|
Chen,Y. and Ma, Y. (2009). Chinese Financial Mixed-operation Management in Modern Financial System, Renmin Univesity of China Press, Beijing. (In Chinese)
Hu, B., Song, W. and Zhang, Y. (2002). The Empirical Analysis of Efficiency in Chinese Securities Market, The Economic Theory and Economic Management, 7, pp. 72-97.
King, R. and Levine, R. (1992). Financial intermediation and economic development, in: C. Mayer and X. Vives., eds., Capital markets and financial intermediation, Cambridge University Press, Cambridge.
Arestis, P. and Demetriades, P. (1993). Finance and Growth: Schumpter May Be Right, Quarterly Journal of Economics, 108, pp. 717-738.
McKinnon, R. (1993). The Order of Economic Liberalization: Financial Control in the Transition to a Market Economy, Johns Hopkins University Press, Baltimore.
Pagano, M. (1993). Financial Markets and Growth: An Overview, European Economic Review, 37, pp. 613-622.
Rajan, R. and Zingales, L. (1998). Finance Dependence and Growth, American Economic Review, 88, pp. 559-586.
The economic growth and macro stabilization study group in China (2007). Financial Development and Economics Growth: The Transformation from Mobilizing Expansion to Market Allocation, Economic Research Journal, 4, pp. 168-196. (In Chinese).
The World Bank (1996). World development report 1996, from planning to market, Oxford University Press, New York.
The World Bank (1997). China 2020: Development Challenges in the New Century, World Bank, Washington.
The World Bank (2001). Finance and economic growth: Policy choices in volatile condition. Oxford University Press, New York.
Wu, J. (2002). Banking Reform: The Priority of Current Financial Reform in China, The World Economy Literatures, 4. pp. 122-139. (In Chinese).
Wu, S. (1996). Efficiency of China’s Securities Market, Economic Research Journal, 4, pp. 172-194.(In Chinese).
Yu, Q. (1995). Market Efficiency, Periodic Anomalies and Share-price Volatility, Economic Research Journal, 9, pp. 101-117. (In Chinese).
Zhang, J. (1998). Financial Support in Progressive Reform, Economic Research Journal, 10, pp 32-49. (In Chinese).