A Comparable Research On The Development Of Financial Structure

Since Raymond W. Goldsmith brought forward an important argument thatfinance development is the outcome of changes in financial structure, related studiesand research with respect to finance development have been widely focused on byinternational financial researchers and practitioners. It has even become a crucial issuefor the adjustment of financial strategies in many countries around the world. Greatdifference in the extent of economic development and choices of economic patternsamong nations have resulted in different characteristics of the financial structure.Since China is currently staying at a critical stage to deepen domestic financialreforms and adjust financial strategies, the way to introduce existing fruits regardinginternational financial structure, combined with orientation, selection and innovationof strategies based on domestic financial conditions have become a key issue amongChina's government bodies. The purpose of this article is to conduct empiricalanalysis on the change of US financial structure in the past 135 years and on thefinancial & economic development of other countries such as China, Germany, Japan,etc to draw the following conclusion: No matter in "market-dominant" countries or"bank-dominant" countries, indirect finance is always positively interacted with directfinance during the period of financial structure changes, when inducible systemalternates with forcible system. Based on this conclusion, combined with manyimportant international innovations in theories such as "functional perspective" byRobert C. Merton and Zvi Bodie as well as "law and finance perspective" by LaPorta,Lopez-de-Silanes,Shleifer and Vishny, I conduct further comparable analysisand standardized research on the current situation, trend and direction of China'sfinancial structure, which is expected to provide theoretical support to contribute tothe success of structural changes in China's financial strategy.