| Applying the theory of industrial organization to banking and finance industry is a frontier in academic research. The classical analysis frame of the industrialorganization theory is the SCP frame, that is, market structure------market conduct------market performance. While in the latest research, the inner factors of theenterprise, such as the structures of property rights and governance are involved in.The article applies the theory of industrial organization to analyzing the structure, conduct and performance of Chinese banking industry. The thesis argues that, Chinese banking industry was developed in a special history environment, and its structure has strong influence on the conduct and performance. It should be the point we focus on .Particularly, the structure contains two parts: the structure of the market and the property rights. Thus, we should study the conduct and performance of our banking industry on the basis of a proper combination of the two different structures.The findings reveal that: although state-owned banks are in oligopoly position, poor structure of property rights and governance, and heavy burden from history lead to their unsatisfactory market performance. However, they have made some progress under the force of market competition. Meanwhile, Joint-Stock Commercial Banks obtain more and more market shares, due to their relatively better structure of property rights and governance. The general performance of banking industry is positively related to the extent of market competition; and negatively related to the state -owned regime.To promote the general market performance of our banking industry, this paper suggests that: the oligopoly market structure as a result of administration rather than market competition should be improved; the innovation in structure of property rights of state-owned banks should be proceeded; the development of small and middle sized banks be greatly encouraged; a fair external environment for market competition be offered. |
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