Chinese Securities Market Equilibrium With Moral Hazard

Starting from the concept of moral hazard in information economics, the dissertation sorts out the financial theories related to moral hazard, anatomizes the moral hazard disfigurements of modern financial theories. After analyzing the main characteristics of irregularity, breach and crime in Chinese securities market, it points out that the fundamental reasons leading to the decline and low efficiency of stock market are the immature foundation to establish the Chinese capital market, systematical deficiencies lying in property right, supervision, separation of ownership right of shares, governmental intervention and transaction, etc... Further it deeply analyzes the status quo of moral hazard and its causes of all principal participants in the securities market, raising a point that the crisis of Chinese securities market is a complex one, and putting forward the basic methods to govern the ecology of securities market.By using the methodology of game theory, it analyzes the major traits and typical behaviors of Chinese securities market in sense of game, indicating that Chinese securities market is at a status of"lemon"equilibrium, and the phenomenon of"bad money drives out good"will ultimately make the securities market in such equilibrium a very fragile and impotent one. Based on game theory, it sets up a dynamic model to supervise the violating behaviors in the securities market.At the macroeconomic level, it discusses the issues whether a market with moral hazard and systematical deficiencies can improve the efficiency of capital allocation and enhance economic development. Through cointegration analysis and Granger causality test, it demonstrates the cause and effect relation between the capital market and economic development and that between fundamental variables of listed firms and macroeconomic variables.