The Development Of Private Economy And The Institutional Innovation Of Private Finance In China

Since reform and opening-up, private economy has developed quickly and become animportant factor of supporting the advance of China economy. However, financing problembought huge influence on private economy in the 1990s. This paper thinks of the institutionaldefect as the principal reason of financing problem. So, the integrity and innovation of privatefinance institution is the key to solve financing problem of private economy. Moreover, theinnovation is beneficial for the change of finance institution and the allocation of financeresource.This paper defined the institutional innovation of private finance as the construction ofprivate finance organization, which mainly is non-governmental bank system and privatecooperative finance system. And though the comparing of private finance institution amongdeveloped countries, this paper concludes the inspiration of developing private financeinstitution. And the institutional construction of external protection is also necessary for theinstitutional innovation of China private finance. Finally, some suggestions on how todevelop non-governmental banks are put forward.The component of this paper:First,"The development and financing problem of private economy",defines mainconcept, describes the financing problem of private economy as the major problem.Second, "The institutional reason of financing problem of private economy and thecause of institutional innovation of private finance",analyzes the special reason of financingproblem of private corporate in China, believes that institutional limitation is the main reasonresulting in the financing problem, and the institutional innovation of private finance is thefactual selection of finance institution in China.Third, "The comparing and inspiration of private finance institution of developedcountries",selects both the institution of non-governmental bank and private cooperativefinance as the beginning of analysis, studies the special factors of those countries, andconcludes the inspiration of developing private finance institution.Forth",The institutional innovation of private finance in China",analyzes the chance andlimitation of internal and external, puts the emphasis on the construction of private financeorganization, which mainly refers the non-governmental bank and private cooperative financeorganization, then studies how to improve the external protection institution of thisinnovation.