The Coordination Study Of Bond Market With Economic Development

As one of the most ancient financial categories, bond can be traced back to the fourth century BC in ancient Greece and Rome. But it was not until the capitalistic period, with the development of economy, did regular and systemized bond market emerge. Then from the middle-late 20th century, worldwide bond market started to flourish and was all part and parcel of capital market as well as the most vigorous component of financial system.Thanks to more than 30 years of reform and opening-up, Chinese bond market has made huge progress, exerting more and more influence in macro economy and financial system. Many dissertations about the relationship between bond market and economy development reveals us a reciprocal and causal relationship between the them. It gives us a real insight into the bond market evolution with distinct theoretical and practical significance.As regards to this issue, too many factors are involved. Therefore it is necessary to analyze the relationship between bond market and economic development. The author mainly adopted two methods:the combination of historical review with practical analysis and the combination of theoretical explanation with empirical test. Sociological methodology is also applied in this dissertation with the help of evaluation principle and index of coordination development theory, the author explores the evaluation criteria for bond well-development. Those criteria are divided into many subsidiary evaluation indexes and empirical analysis has been made by collecting detailed time series data, utilizing Eviews software package, cointergaration and Granger Causality.By taking the coordination development of bond markets and structural transition of bond markets, and reveals the intrinsic characteristics of bond market, and reveals the intrinsic characteristics of bond markets influence on economic growth, the financial operation and then enterprise management. By utilizing the coordination development theory, the author puts forward a theoretical hypothesis of a well-balanced development of bond markets, which plays an essential theoretical foundation for the whole dissertation.Then through conducting researches and empirical tests on bond market development in America, Germany, Japan, he generalizes the regular pattern of bond markets’s evolution and structural transition of a country’s economy. Based on all the above analyses and taking China economic and finance development as well as establishing systems into consideration, the author finally puts forward an ideal coordination development mode of bond market.The conclusions of these dissertations are as follows:1. Hundreds years of history proves that the development of bond markets and the transformation of its structure are all along a natural path. Compulsory systemic arrangement may push the bond markets forward for short run, but only by adhering to the inherent laws of its evolution, can we guarantee a healthy development of bond market. Otherswise, destructive impact may come out of control and finally dominate bond market.2. The dissertation advances some new ideas of bond markets balanced development. When studying the development of economy, the evolution of financial system and the transformation of enterprise system, the author finds that coordination development relations do exist among bond markets, economic development. Bond market can not progress all by itself since it can not break the limitations of economic condition,financial status or enterprise system.3. China’s bond market did not realize a balanced development until the reform and opening up. The growth of economy laid on economic foundation for the bond market, which promote its development. It is also important to keep enterprise bond within a limited scale so that we can prevent a development discrepancy from emerging. However, there still are some disharmonious factors in internal structure, and has resulted in a low percentage of commercial finance institute bond, which has become an obstacle to the coordinative development of bond market with intermediary bank.4.By taking economic development, the dissertation brings forward an ideal mode for Chinese bond markes balanced development:bond market development should be coordinated with economic growth. The issue of management of utilizing the debt should be controlled, and the management of utilizing the debt should be manipulated well. We should also grant local government the rights to issue more short-term government bonds to satisfy the demands for liquidity management of commercial banks as well as the regulation of central bank.