The Role Of Government In Financial Development

This dissertation consists of seven chapters.The first chapter is an introduction. It includes a brief survey of the current domestic and abroad research statues concerning this subject and the significance and importance of this research subject.Chapter 2 analyses the formation and development of the theory of government's intervention in financial development, comparing the differences and similarities between "financial repression" and "financial constraint".Based on a case study of Malaysia's financial development, chapter 3 and chapter 4 make an empirical analysis of the development process and experiences of the government-driven financial systems in East Asia.Chapter 5 points out that the theory of market-enhancing government's role stresses that the role of the government lies not only in relaxing financial controls, but also in introducing market mechanism and competition factors to domestic financial sectors, thus realizing the efficiency of dynamic resources allocation. It is more important for the government of the developing countries to play its role in promoting financial reform and institutional innovation. The government should shift its role from making up for the market failure in resource allocation to enlarging market mechanism and innovating financial institutions.Chapter 6 deals with the financial reform in China. The Chinese government should focus its role in creating conditions for the development of market mechanism and institutional innovations in financial fields by further opening up and introducing competition factors to the government-controlled sectors.Chapter 7 is a brief conclusion of this dissertation. It concludes three issues which have bee analyzed and studied in this dissertation, namely the relationships between the government and enterprises and financial development; the role of the government in promoting financial reform and institutional innovation; the direction of the financial reform in developing countries.