| The investor protection is the important factor to impact on the development of capital market. The current researches show that the investor protection has a positive effect on one country's capital market development. After more than twenty years development the size of China's capital market has grown fast. However, the uneven of its regional development is outstanding at the same time. From the viewpoint of investor protection, this paper explores the reason of China's regional difference of capital market development (RDCMD) and analyzes the impact of the differences of investor protection on China's RDCMD, which caused by legal enforcement and inter-provincial residual corporate governance(IRCG) represented by local laws and regulations under the circumstance of facing the same legislation.We draw the following conclusions:(1) the investor protection is one of the important reasons to form China's RDCMD and (2) the judiciary is the main reason to produce the difference of the investor protection in China's various regions and has the significant influence on the RDCMD and (3) the IRCG is also an important reason to contributed to the difference of the investor protection in different regions, but its influence on the RDCMD is not obvious at present.In this paper we firstly describe quantitatively the degree of all Chinese provinces'investor protection and the status of the RDCMD, followed by analyzing qualitatively the influence of different legal enforcement and the IRCG on the RDCMD. Then we have an empirical test using panel data for the 31 Chinese provinces from 1992-2007. After controlling a series of factors (e.g., economic development, capital market volatility, cultural quality, area, time trend, etc.), the results support the conclusion, i.e. the investor protection has an active influence on the RDCMD. Finally we present some targeted policy suggestions. Using China's empirical evidences, this paper support and enrich LLSV's main viewpoint.
|
PDF Full Text Request