Path Dependency Of Chinese Monetary System Reform

This dissertation covers the study of Path dependency on whichChinese monetary system changes in the process of its gradually economicstructural reform, and the examination of the future changes and strategicchoices for Chinese monetary system in its new stage, the foregoingprovides an essential basis for furthering Chinese economic structuralreform and establishing a highly efficient and rational monetary system withan effective operation and also is a theoretical task not to be evaded ineconomic sociology and social theory. Monetary system is the architecture of finance established by a countrythrough laws, rules and regulations, monetary policy etc and the respectivecodes of practice, mutual relations and obligatory division of labor amongkey elements in this system, which can be further divided into three levels:(1) laws, rules and regulations and monetary policy as the highest level, i.e.in general, monetary activities and deal regulations that will curb probablewillful acts and opportunism and thereby enable monetary activities anddeals predictable to a certain extent. (2) The middle level of monetarysystem is the structure of financial architecture, including financial setupand supervision institution. In appearance, monetary system is of external,imposed from above and executed. Still, monetary system itself has somecharacteristics of specific system, i.e. it, in certain meaning, is acombination of codes of conduct by the main body of financial activities. (3)The basic level of monetary system consists of financial activities and actsof financial dealers, whose behavior is to a great extent bound by the rulesof the highest level; conversely, whose behavior will have an effect on the —— 141interrelationship of the whole monetary system and further impact onformulation and modification to the rules. As a result, the reality is thatfinancial activities and financial dealers give their share in working outmonetary system. In the beginning, the change in Chinese monetary system was subjectedto such circumstances as political economic orders characteristic of highcentralization and monetary system of great national unity, in whichpeople's Bank of China played the part of central bank as well ascommercial bank, the government was in an absolute leading position in theprocess of allocation of resources and reforms, principal parts of economyand residents were low in capability to operate independently andmaintained a distant financial consciousness, consequently, the orientation,depth, width, rate, strategic choices etc in our reforms of monetary systemdepended on the aspirations and competence of the central authority one thewhole. At long last, the development and furtherance of reform willtransform the former power structure and the situation of force comparison,but the mode will not undergo fundamental change with the governmentdominating role in the monetary system reform as long as the process of theallocation of resources and reform of the whole society is still characteristicof centralization of state power, in general. Looking at the problem from itspractical aspect, the change in Chinese monetary system, promoted by theauthority center, underwent the following courses – establishing suchfinancial setup as state-owned commercial bank, policy bank, insurancebank, securities institution and resuming their business, separating thefunction of central bank as commercial bank, fostering main bodies inoperation, for financial enterprises, improving their independent operatingcapability and financial consciousness, by now, a particular system offinancial setup has taken shape, in which People's Bank of China, ChinaBank Regulatory Commission, China Securities Regulatory Commissionand China Insurance Regulatory Commission serve as supervision agencies,policy banks, state-owned commercial banks, joint-stock banks, rural...