A Neo-Institutional Economic Analysis Of The Development Of U.S. Stock Market

The Shanghai Composite Index rose to 6,000 points in Oct, 2007 and fell to2700 points in Jul, 2008. why? As a fastest growing economy, why did the stock market in China suffer a so big fluctuation during the corresponding period? How can the A-share market back to the normal state? These questions stimulate me to write this paper down, but it's rather difficult finding the answers through the chinese stock market itself, who is only 17 years old. Sincewe choose the top one share as our investment, the US Stock Market ,NO. 1 in the whole world stock market, must be the reference to analize the Chinese stock market.Looking back on the 216-year course of the US stock market, we can find out that it played important role in every stage of the development in American economy and provided a steady flow of funds for it. As the development of the US economy, the US stock market became the whole world's center of finacial system.There are six chapters in this paper:The first part is the introduction.In this part, I develope the purposes and significance of this paper,and summarize the literatures about US stock market at home and abroad.After reading and studying a lot of the literatures,I have found two questions: one is that most of scholars'research is about the early US stock market(befor 1932),they concentrate on contemporary market; the other one is that the books and articles about studies on US stock market from institutional degree are very little.Since internal scholars pay little attention on this project,the documents from abroad scholars are framentary,therefore,it is an arduous and creative work to do deep research on US stock market.On the guide of Marxism's points and methods,and as analytical tools of new institution economics,information economics,related theories of stock market and behavior theory,through analyzing the historical process of US stock market, microinstitution and macroinstitution,this paper reveals the reasons and characters for US stock market flourishment.Moreover,on the basis of reviewing and analyzing the development process and problems of China stock market,it made policy suggestions and prospectives on our market. The second part, institution,institutional change and stock market.The key factor of US stock market flourishment is:institution.In this part,I illustrates the connotation and functions of institution,institutional transition theory and relationships between institutional change and stock market.This part mainly makes theoretical preparations for next parts.The third part,historical process of US stock market.the development history of US stock market is very long,also very complicated.Through separating three periods,that is(1)before the great Depression;(2)during 1930—1990;(3)after 1990,We describe and analyze important events of every period,especially for formations concerned about stock market institutions,this part supplies historical and practical materials for the next two chapters.The fouth part,microinstitution analysis on US stock market.This part emphasizes on concrete contents,characters and functions of microinstitution about US stock market,these institutions mainly include governance structure of public company,independence director, stock option motivation mechanism, investor behavior, trading institution etc.It is these institutions that make up the basic contents and main characters of US stock market,these microinstitutions are also examples for global stock markets.The fifth part,successful experiences from US stock market and its enlightenment to China.this part concludes the experiences and lessons from US stock market,describes the development process of China stock market and its problems.In this part,we also makes suggestions on development way and reform direction of China stock market,that is(1)strengthening institutional creation;(2)improving quality of public companies;(3)enhancing supervision of stock market. Finally,we predict that(1)the energy of China stock market will be strengthened;(2)market will be more efficient and rational;(3)market value will be more worthy;(4)service will be more professional;(5)appearance of the stock index futures will lead to large changes;(6)more and more institutional creations will promote healthy development of China stock market.