Study The Incentive Compatibility Of China's Banking Regulatory System

As one of the public goods, the banking supervising can only owe its responsibility to the government. However, incomplete information and inherent defect of government always lead the banking supervising to be failure, and bring the system of banking supervising on incentive incompatibility at last.Till now, the study on incentive compatibility mainly focuses on generic theoretic analysis. It rarely involves the incentive mechanism design of supervising organizations. The demonstrable analysis on how to build a supervising system with incentive compatibility is very few. To make up for all of the shortage listed above, this paper analyzes the relationship between supervising system and supervising objective detailed, and then summarizes the cause and representation of incentive incompatibility systematically. Besides these, it discusses how to build a supervising system with incentive compatibility suited to our country from the two aspects of supervising system and inherent supervising mechanism.Based on the concretely analysis about the supervising actuality of our banking, the article establishes an agent model with multi-incentive content using symbolic methods, points out that the restrictive terms of incentive compatibility include three sides, i.e. Participating restriction, compatible restriction and realistic restriction, and sets forth the realistic meaning of these restrictive terms. Afterwards, chooses city A as the object of demonstration, and analyzes its status quo of bankingsupervising, acquires the experiential data of supervising compensative coefficient and theoretic data accorded with restrictive terms of incentive compatibility by the use of experiential materials and theoretic model separately, compares the difference between these two data and anatomizes the forming reason of these difference, indicates the advantage and shortage on supervising mechanism building of the people bank in this city. At last, some policy suggestions on banking supervising are brought forward from two aspects of supervising system and incentive mechanism.