Game Theory Applied Research In China's Financial Markets

Game theory is the theory which researches issues of strategy-making of many participants. It has become one of the most common analytical tools in modern economics. This thesis tries to apply the game theory to the financial market of China and analyses relevant issues of Chinese financial market from the angle of game theory. There are four chapters in this thesis. Chapter 1 reviews the outline of game theory and its development history. At the same time it points out that the operation of the financial market is the game of financial market players. It is practical to apply the game theory in analyzing the player's activity. Chapters 2, 3 and 4 are the focal parts of this thesis, which apply the game theory in the credit marketx the stock market and financial market supervision. A series of beneficial conclusions and enlightenment will be gained on the basis of game analyses. In chapter 2, this paper utilizes dynamic game theory to construct game models of credit. From the two aspects of dynamic games of complete and prefect information and dynamic games of complete but imperfect information, it thoroughly analyses mutual strategy-changing relationship on credit activity between commercial banks and enterprises. In chapter 3, having non-symmetric information as its background, it analyses the strategy-making activities between the issuers and the investors in the primary market, and between institution investors and private investors in the secondary market. Furthermore, it discusses many aspects such as enterprises' financing^ capital resources allocation information disclosure and construction of the stock market in China. In chapter 4, attention is paid to management and supervision of the financial market of China in light of game theory, from which some policy proposals that will improve the efficiency of financial management and supervision are put forward.