The Problem Of The Private Enterprises' Financing In China

I.Brief Exposition of the Relationship between Government and EnterprisesFirst, origin and change of market spontaneous regulating theory. In western market economic theory, advocating market free organization and spontaneously regulating function have become its essential aspect whose representative, Boisguilbert, thought that as long as government's artificial interference was abolished and under the condition of full free competition market, social economy itself tends to be balanced and coordinated. The representative of physiocracy, Adam·Smith thought that free competition is a"Invisible Hand", which can automatically regulate economic performance. He opposed state intervention and thought that state serves as role of"Night Watchman", whose theory had been inherited and developed by David Ricardo. The"Say's Law"stresses free economy and encourages increasing production and gives up state intervention.Second, Origin and Change of Government Intervention Theory. By the end of 18th century, western scholars had began to explicate the defect of market mechanism. An Introduction to Employment, Profit and Money by Keynes, severely criticized the theory of automatic balance by market force by Sayor, in 1936. He demanded that the government function should be changed into"and active intervenor"from"Night Watchman"by Adam Smith, which may remedy the defect of"Invisible Hand"of the government on the market being replaced with"Visible Hand"of the government.Third, Rising of New Free Market Theory. After the 1950's, a new trend of thoughts on free market thinks that the principle of"invisible hands"by Adam Smith is correct in nature and it doesn't work on the market because of government intervention. Since the 1970's, people with the thought oppose the nation's intervention on the life of citizens and advocate spontaneous regulation by market force.Fourth, A New Comprehensive Theory Combining Market with the Government. Function of market and the government and the controversy over the relationship between the function of market and government promotes the...