A Research On Economical Efficiency Of Chinese Stock Market Under The Government Regulation

The Chinese government has played a pivotal role in the stock market development in China. Based on the research of the efficiency of the stock market under the government control, the paper summed up the reasons why China's stock market efficiency is lower than Western countries and put forward the scientific proposals for the future market reform of the stock market, which has practical significance for the development of China's stock market in the future, as well as the supposed important role in economic growth.The paper studied the economical efficiency of the stock market under government control. It discussed the stock market environment system and how the system environment can affect the stock investment decisions of market participants from the macro point in order to discover the deep reasons which impact economical efficiency of the China's stock market and find out the future direction of market oriented reform of the stock market, so that China's stock market can made its supposed contribution to sustainable and healthy economic growth. The paper applied the theory of government regulation, theory of rent-seeking, theory of incomplete information dynamic game, theory of econometrics and statistics. The paper focus on the analysis and empirical research to China Stock Market under the government control, the main conclusions are divided into two parts:1. Theoretical results: the implementer of government creates their own rent by using the shortcoming of system regulation or policy to own and corporations carry rent-seeking activities for their benefits; the government use policy measures etc to intervene on the stock price volatility, which make investors, have adaptive expectations to policy, leading investors to form a non-rational investment decision-making. Because of that, the stock market can not make optimal allocation of resources.2. Empirical conclusions: (1) The government regulation policy's change develops in the target cycling rate and the value in exchange influence to the stock market is very big, but relatively is actually small to the capitalization rate influence; (2) stock market size and economic growth existed long-term positive balance, while from a comprehensively view, the stock market liquidity and economic growth relationship is not so significant. (3) During the sample period, stock market development indicators and economic growth did not show statistical causality. (4) based on the analysis to the dynamic relationship between stock market development indicators and economic growth, it can be drawn that the capitalization rate and the value of the transaction promote China's economic growth to a certain extent, which is not obvious compared with the Western countries; the turnover rate and economic growth has a negative correlation of, which may be because of Chinese investors irrational investment decisions. Conversely, economic growth promotion to the performance of the stock market is obvious, mainly of economic growth's catalytic role in the medium and long term development indicators of the stock market.