Chinese Stock Market's Model Analysis Of The Inner Instability And Its Non-linearity Research

Based on outer macro-economic aspect, traditional economic theories give some explanations on modern financial markets, which of course include security market. But facts prove that those theories are losing the power of explanation, because modern financial markets' instability is showing different characters: financial turbulence tends to take place only in comparatively closed fields. Previous to financial disturbance, macro-economic system runs smoothly. It seems the correlation between financial turbulence and real economy is not obvious. What's more, traditional theories' researches on the stochastic resources and related mathematic models usually derive from linearity or log-linearity added by random terms. So research methods should be changed. The connotation of stock markets' inner instability lies not in violation, but in the self-balance ability in the wake of outer impact. Market's instability means market will fluctuate one way greatly and lastingly. This article, to begin with, tries to set up stock markets' models from different prospects and ushers in inner variables that influence the stability from different ways, in order to build up the theoretical foundations. Then, more from non-linearity this article does some empirical researches on the phenomenon since the debut of reducing state-owned shares' regulation, our stock market dives so obviously, hoping to find out whether our stock market is non-linear system and whether the non-linearity is the inner mechanism of market's instability.