China Stock Market Efficiency Research

The stock market is playing more and more important role in promoting the implement and reform of economic system in China as a concernful implement and carrier. The profundity comprehensive reform of stock market has been a necessity while central plan system shunts to market-oriented economy. However the stock market of China was born out of the central plan economical system and owing to the restriction of economic and historical environment, there were some systemic limitations and extrusive problems stayed behind the plan economy. As a result, there was a stock market that has low efficiency and high risk in China, which severely restricts the development of stock market!In this thesis, the author tried to explain the causes why the efficiency in Chinese stock is low, and pointed out that the system defect is the main cause. Because of "the father lovers" and "North paradox", the government often interferes the stock market in order to protect the state-owned enterprises. At the same time, the state-owned enterprise doesn't transfer the movement system by reason of "the father lovers". Because the state-owned investment person absents, the internal personnel is engaged in some contrary transactions to obtain the personal interest. This posed the enormous threat to the stock market effective movement.Therefore this article thought: In order to advance Chinese stock market efficiency, must take ways to innovate system, try to convert development model of stock market from "government dominated style" to "market oriented style", try to convert market function from mainly serve for resource of enterprises financing to advance efficiency of resource collocation. Many measures should be considered and adopted, such as rectifies the role localization, relieves the government recessive obligation of warranty, establishes the strict examination system and so on.The creation of the article to be placed in discussing the direct relationship between the state-owned enterprise and the stock market. It explains the problem in the state-owned enterprise reform by using the North paradox theory. According to Non-Tradable Shares Reforms, this article also pointed out the function of our stock market is lacking and the efficiency of our stock market is low.