On Financial Support System Of Network Economy

Network economy and modern industry of finance are two supporting pillars of modern economy. In fact, the network economy stems from the development of modern financing. The demand for financial supporting system of the network economy comes from its economics nature. The network's supply-side character, ever-declining average cost and its demand-side character, increased marginal utility give birth to a different functioning principle from the traditional economy, thus arises the demand for financial supporting system. After many years' development, the supply of institution according to financial supporting system has been founded in a lot of fields in industry of finance, such as security market, investment fund. The supply and demand of institution come to be equilibrium in venture capital and second market. The development of network economy in which the venture capital and second market are the core bases on financial supporting system. Investors in second market are the final link of financial chain, hence supposed there were no invest in dot-corn stock, the situation would be follows: the second market would collapse, dot-corn would not proceed IPO, venture capital fund would lose, venture capital could not reach good circulation, dot-corn would have no capital dependent and conclusively network economy would step into stagnancy. In order to preventing from this situation, in long term, we only hope the change of investors' idea of investment; in short term, we should enhance the supervision to the second market.