Research On Market Structure And Performance Of China's Investment Banking

The financial system of China is in premature period. There are many realistic problems which should be explained. Take investment banking as an example, high-efficiency dynamic competing structure is absent. Meanwhile Investment bank and other derivative financial institute become more and more important in mordern financial system. So it is necessary to analyze such problems as the performance measurement, market structure, and regulation of investment banking.This dissertation consists of six chapters. Chapter one is the introduction. This part looked back related theories foundation, putting forward necessity and research frame of the market structure and performance of the investment banking in China.Chapter two, market structure and performance of Investment banking: Related research. Economists put forward different research methods: Structure-Conduct-Performance method, X-Efficiency hypothesis, Economies of Scale hypothesis,and Economies of Scope hypothesis, etc. Different opinions caused different financial regulations system and policy.Chapter three, market structure of China's investment banking. To analyze the market structure of investment banking in China, we can follow five factors: existing competitors, the threat of substitute(products or service), the threat of possible entrant, negotiation ability with suppliers,and negotiation ability with customers. From the analysis of these five aspects , we found that firms in this industry competed excesssively.Chapter four, research on China's investment banking performance measurement and related factors. Making use of various methods to China's investment banking performance measurement, when compare with economists' research on commercial bank's performance, the cost performance , profit performance and standard profit performance of local investment banks are all very low. The study also provide some meaningful conclusions on relationship of performance and scale. From the three aspects(the strategy, implement of strategy ,and market environment), we analyzed the determinging factors of domestic investment banking performance.Chapter five, the process of evolving of Market structure and performance—international comparison and policy suggestion. We mainly observed market structure and performance of American investment banking. The main case adopted in this chapter is Merril Lynch Company. After the Contrast analysis of Chinese and American investment bank, it can be concluded that organization innovation, profit model innovation and business innovation will promote domestic investment banking competition ability. In the end, Chapter six, government regulation and its influence on investment banking market structure. Strong negative exterior effect in the financial system, free competition and finance stability as a policy predicament, the serious information dissymmetry in financial market, and investment bank as a kind of special financial firm. Because of above reasons, in the western, governments usually carry out stricit control on investment banking. In the past, the government regulation influenced China's investment banking market structure profoundly. It will still influence the direction of investment banking in the future.