Under Government Control Efficiency Of Capital Markets Research

The development of China's capital market is accompanied by the transition of economic system, so capital market is a product of mandatory system changes, and from the outset, the capital market is deeply imprinted in the government regulation.It is the implementation of a three-dimensional structure of the regulation imposed by government, the financing structure control on the horizontal direction, the market-level control on the vertical direction, and the market access control on the Main Board that makes China's capital market still not a real market. Compared with capital markets in developed countries, China's capital market exists clear defects on system and structure, which resulted in that capital market can not select a large number of listed companies with good quality, and also can not cultivate high-quality listing back-up enterprises and industries. To some extent, Capital market can only become a swamp of speculation, which affects the efficiency of the capital market both at present and in the future. Based on the above-mentioned, the paper tries to analyze systematically how the position, purpose, and ways of the government regulation impact enterprises and industry, and then the efficiency of capital market.Nowadays many research on the efficiency of capital markets are trapped in applying the "market efficiency hypothesis" theory to test the efficiency of China's capital market mechanically, and get different conclusions, some argue that capital market is efficient, others adhere to the opposite point of view, inefficient or weak-form efficient. It is clear that these studies rarely consider the special market structure and institutional context of China's capital market, the resulting evaluation criteria on efficiency can not reflect the real situation of China's capital market.The full text is divided into nine parts.Chapter 1: elaborate the connotation of the capital and the capital market. Firstly, according to the status quo of China's financial development, define capital market as the medium and long-term financing market, mainly including medium and long-term loan capital markets and securities markets which include medium and long-term corporate bond market and stock market. Secondly, analyze the similarities and differences between the capital market efficiency and EMH, and point out that the capital markets efficiency should not only reflect the information efficiency and transaction efficiency, but more importantly should reflect the efficiency of practical application of capital. Chapter 2: research regulation theory on the capital market. Through the Analysis of the meanings of government regulation, exploring the government theory, interest group theory and failure to regulation theory, describing the game equilibrium among market participants, in order to illustrate the nature, reasons and results of government control, as well as the characteristics of market participants.Chapter 3: mainly research the history of government regulation on China's capital market, explore the historical background, necessity, and structure of regulation. The structure of regulation consists of financing structure regulation, market access regulation and market level regulation, which mutually reinforce and jointly impact the capital market both at present and in the future.Chapter 4: on the basis of the previous chapters, summarize the characteristics of China's capital market, evaluation system of capital market efficiency, and make a conclusion that under present stage, we should emphasize efficiency that the capital market allocates economic resources under the constraint of government regulation. Chapter 5: Analyze how financing structure regulation impacts the capital market efficiency. Firstly, analyze how both corporate bond regulation and interest rates regulation lead to "compulsory savings", which led to excess liquidity in the stock market. And analyze the relationship between "compulsory savings" and stock market volatility; secondly, research on how corporate bonds regulation weaken the function of the bond market, thereby affect bond financing for small and medium-sized enterprises; thirdly, study how financial structure regulation distort corporate financial behavior, and thereby how it affects the quality of enterprises and industries. A conclusion arises that on the one hand, financial structure regulation force savings into stock market which strengthen the imbalance between supply and demand in stock market, which affects the efficiency of stock market now, on the other hand, it inhibits the improvement of qualities of overall China's enterprises, which makes capital market can not supply proposed high-quality listed companies continuously for Main Board, which would affect the future of capital market efficiency.Chapter 6: Analyze how market access regulation on Main Board, mainly for stock market, impact capital market efficiency. Firstly, note how the level of market access regulation inhibit non-state enterprises into Main Board, then research into the derivatives of market access regulation, namely the relationship between the control of issue price and the formation of "stock lemon market"; secondly, research into how market access regulation distort the structure of stock market, and make a conclusion that the companies ' access to the Main Board of is subject to "rationing scheme", then analyze how market access regulation impact investment value of listed companies. Finally, study the game among market participants, as well as how the game impact capital market efficiency, and come to a conclusion that capital market is irrational. The conclusion of this section is that market access regulation distort the behaviors of market participates through inhibiting the qualities of listed companies which impacts the allocation efficiency of economic resources.Chapter 7: research into how the market-level regulation impact capital market efficiency. Firstly, analyze the importance of multi-level capital market from the perspective of corporate development. Secondly, study how the single-level capital market impacts the capital allocation among regions, technological innovation, and marginal productivity of capital. The single-level capital market leads to the imbalance of capital allocation among regions and the lack of technological innovation, which bring about low contributing rate for economic growth. Chapter 8: empirical testChapter 9: On countermeasures. According to the aforementioned theoretical and empirical research, some measures to improve the capital market efficiency are given, including easing regulations on interest rate and corporate bond market, construct a multi-level capital market.