A Study On Financial Crisis’s Transmission Mechanism Of Chinese Stock Price Index And Its Influence

After the financial crisis emerged in2008, the growth rate of the world’s economy growth rate decline, as well as the economic index of each country. It also affect on Chinese real economy index and stock index. Chinese stock market is the important financial market which can help the company get investment. So, we analyse how the financial crisis affect Chinese stock market index can find model of Chinese stock price index action, and the path of the current development of China’s stock market bottomed out, which both has important theoretical value and practical value. In this paper, we focus on the effect of financial crisis on Chinese stock price index, and analyses the policy and stragy under financial crisis.First of all, we analyses the domestic and international research about the financial crisis. Based on previous research, we believe that the international financial crisis is one of the main factors of Chinese stock market prices index in recent years. And we build real economy transmission and "pure transmission" of financial crisis, which could explane the financial crisis’s effect on Chinese stock price index.Then, we combine financial crisis and macro-economy by dynamic stochastic general equilibrium theory to establish a real economic transmission mechanism of the financial crisis. We made three sectors of the economy on the hypothesis of the residents choose to invest in Chinese stock market. Though DSGE model’s real business cycle model, we use improved RBC test the real economy transmission mechanism. Financial crisis make the Chinese stock price index go down though the real economy transmission.Forthmore, we build "pure transimission" mechanism of the financial crisis, which base on international price linkage and international price diffenence. This proposed financial linkage concept based on rational expectations theory, common debet man and mind factors. This mechanism links different countries’s stock market through a direct impact. We use VAR model and GARCH model to constract the transmission mechanism and exercise the model. The results show that Chinese stock price index has the positive relationship with American and Eourpean stock price, which indirectly prove the "pure transimission" mechanisms of the financial do exist.Moreover, foreign financial crisis affect China’s stock market sector inde differently, and the reason may relate with the characteristics of each sector’s own development and different adjustment of each sectors after financial crise. According the empirical result, we divide the mode of the financial crisis effect on sector index into three categories, long-term effects mode, mid-term effects mode and short-term effects mode.Last but not least, we analyse of the transmission mechanism of the financial crisis, which contains the real economy though the Chinese macro-economy and the "pure transmission" though micro-financial markets. Then we study the consequences and from theoretical and practical aspects of the financial crisis, combined with the country’s economic stimulus plan, the relevant monetary policy, the fiscal policy and so on. And we give the consequences of the policy discussion and evaluation, modeling and econometric evidence examined in the implementation of relevant policies. Also, we use bootsrap method test the financial crisis factor’s effect on stcok price, containing government’s some policies.Based on the theoretical and empirical research, we get the special stragy of the development of China’s stock market, as follows:Improving the stock market’s positioning; pushing the stock market’s reform strategy; comsummating trading system, strengthening the legal and regulatory strategies; enhancing corporate governance structure strategy.Also, we give the policies of the government how to decrease financial risk and reduce the effect of financial crisis. As follows:Strengthening financial intermediaries regulatory strategies; diversificating international investment and international trade strategy; encouraging institutions and residents to invest in the stock market strategies; developing bond market and other financial market strategy; developing secondary securities markets.By the above strategies and policies, this paper attempts to enhance the function of Chinese stock market, and make the Chinese stock market into high-quality and efficient market.