Analyzing Theoretically And Solving Realistically Reputation Crisis Of Capital Operation

In recent years, a great deal of illegal case attaint reputation of capital market and investors lose confidences during capital operation. So, pressing task is researching solution to reputation crisis about capital operation. We analyze popularly capital operation in order to find what result in reputation crisis and how to resolve it in pertinent to theory. These theories including Information Economics Theory, Institution Economics Theory, Controlled Economics Theory, Ethics Economics Theory, and so on. The conclusion from the analysis is that asymmetric information results in reputation crisis during capital operation. Concerning the resolution to reputation crisis in capital market, we think that formal institutions established by government and informal institutions control action of operators. Informal institutions including ethics, morality, and so forth.Reputation crisis is especial in our country. Hence, on the base of generic analysis, the paper analyzes reputation crisis about capital operation in order to find the case and the resolution. Our analysis bases on institutions of capital market, information, capital market efficiency, government control, ethics and so on. The essential causes that result in reputation crisis are wrong orientation of capital market and special institutions. Of course, asymmetric information, government control's error and business ethics' losing aggravate reputation crisis about capital operation. So, we must innovate institution on capital operation and government control. At the same time, we must perfect business ethics.