Research On The Pricing Strategies Of Chinese Bankcard Industry Based On Network Externality

Basing on more than twenty years' development, Chinese bankcard industry has already formed a comparative scale and becomes more and more mature. As a relatively independent industry, the development of bankcard industry is sure to exert profound influences on all of the national economy. Thanks to the various function, the bankcard not only brings a lot of convenience to people's life, but also produces plenty income to the bank. Therefore, the banks at home and abroad all set the development of the bankcard as an important target. However, the circulation of the bankcard is inconsistent with the transaction in China; the proportion of the bankcard income is also very low in the whole banking industry. As is known to all, the pricing strategy of the bankcard is a decisive factor of the banking profit. It is in the view that this paper chooses the pricing strategy of the bankcard as the research subject and carries out a series of studies, basing on the network externality theory and the actuality of Chinese bankcard industry, using the Undercut-proof Equilibrium Model and the method of demonstration, hoping these studies could merit some of references for the further and sustainable development of Chinese bankcard industry.This dissertation is divided into six parts. First of all, we briefly introduce the study background, the content of this paper and the creative concept. Chapter 1 summarizes the theory of network externality as well as the domestic and international researches on the bankcard industry pricing theory. Chapter 2 describes the operating characteristic of the bankcard industry and makes an economic analysis for it. Chapter 3 analyses the development actuality and the pricing status in Chinese bankcard industry. Chapter 4 is the core of this paper. Developing an Undercut-proof Equilibrium Model, this part focuses on making a analysis for the pricing strategies of bankcard industry and comes to a conclusion. Subsequently, we use the method of demonstration to validate some of the important conclusions of the foregoing model in Chinese bankcard industry. Chapter 5 puts forward suggestion for the optimal development of China's bankcard industry. In closing, the last part makes a conclusion for the total dissertation .It also brings out other research fields of the bankcard industry, which will merit the further study.