A Study On The Influence Of Financial Disintermediation On China 's Capital Allocation Efficiency

In order to maintain price stability and to effectively promote positive adjustment of the economic structure, growth of the China’s money supply is obviously slowing down in the latest years. Under the influence, large quantity of capital requirement turns to new financing channels such as private lending, trust financing, financing bills, bonds and New OTC Market instead of traditional bank financing. Meanwhile, with the explosive development of the Internet finance industry, a large amount of deposit flows out of the bank and turns to a variety of sources such as wealth management products. Those phenomena are quick responses of the trend of financial disintermediation in the global economic development. A relatively mature capital market is one of the key premise for capital allocation playing a positive role. It is benefit for China’s reform of capital market to research the mechanism and influence of financial disintermediation has on the efficiency of capital allocation. Moreover, the research will make great sense in converting the economic development pattern and optimizing the economic structure. Firstly, this paper summaries the domestic and overseas literature about the themes on "financial disintermediation", "capital allocation efficiency" and "the effect of financial disintermediation on capital allocation efficiency" adopting the method of literature review. Then, on the basis of the theory of financial intermediation, this paper interprets the formation mechanism of financial disintermediation, and analyzes the microscopic and macroscopic mechanism of the impact of the financial disintermediation on capital allocation efficiency applying the model of consumers, producers and IS-LM. After comparison, this paper chooses the method of financial assets and liabilities statistics to structure the financial disintermediation index and calculates the capital allocation efficiency with the methods of DEA and Malmquist Index from 1978 to 2014. Finally, this paper makes an empirical analysis of the influence of financial disintermediation on capital allocation efficiency by parameter analysis, Granger causality test, impulse response function analysis and variance analysis.In this paper, the conclusions are as follows:In the first place, financial disintermediation has been an inevitable trend in China’s future financial system reform, and the degree of disintermediation of financial asset department is deeper than that of the financial debt apartment. Moreover, Granger causality test tells that financial disintermediation can influence capital allocation efficiency, which illustrates "delay effect" at the same time. The results also show that financial disintermediation has an obvious term structure effect on capital allocation efficiency. In the short-term, financial disintermediation significantly effects capital allocation efficiency, but the effect doesn’t actively last long and turns out to be negative in the mid-term. While in the long-term, financial disintermediation doesn’t play an active role in improving capital allocation efficiency. Finally, this paper promotes some policy suggestions in the respects of development of commercial banking business model, the construction of a multi-level capital market, coordination of the development of commercial banks and capital market development, and financial innovation thought.