Analysis On The Game In Chinese Stock Market Under The Situation Of Asymmetric Information

Asymmetry of information is determined by uncertainty of the market, division of labors, the development of profession, and many other factors. Asymmetry of information may affect any economic market unfavorably. In the securities business, especially in the stock market, the influence and function of information asymmetry to the market participants is greater than that in any other market. It just is the information that determines the price of the stock and the behavior of the investors. Therefore, it is directly to influence the function of the stock market and the market efficiency, whether the information of stock market is symmetry.This paper analyzed asymmetry of information in Chinese stock market, which is more serious than that in the Europe and USA. Asymmetry of information in Chinese stock market resulted in "the adverse choice" and "the morals hazard" in the primary market, and "the adverse choice" and heavily speculative behavior in the secondary market.Based on these understandings and guided by the dynamic game theories under incomplete information, the behaviour of players in the stock market was studied. The advice to strengthen supervision and to enforce punishment is proposed to decrease information hiding phenomena of listed companies (or postponed disclosure, false disclosure) by game theoretic analysis of information disclosure between the companies with supervision or without it. On the policy level suggestion to improve stable development of the stock market was presented according to brief analysis of the operation status and the equilibrium state. The proposition which may reduce the influence of national policy on stock market's fluctuation was put forward with game theoretic analysis between the investors and the government. The game theoretic model was built up by studying the relationship among the listed companies, the institution investors, and the small and medium investors in stock market of China.Game theoretic analysis of the investors in the stock market was made according...