China Resources Allocation Efficiency Of Listed Companies

As one of the most important functions of capital markets, the efficiency of resources allocation can be used as an measure of operational efficiency of the whole capital markets. In this paper, listed companies’capital allocation efficiency is seriously researched.Functions of capital markets, the evolution of IPO systems and several major factors that may influence the flow of capital are analyzed in this paper firstly. Then, after adjusted the capital service prices, TFPs for Chinese companies during the periods from2002to2010year are calculated using the financial statement of listed companies, meanwhile, this paper also analyzed the reasons and trends of fluctuations of TFPs. At the length, the capital allocation efficiencies for Chinese capital markets are respectively empirically tested by time and by sectors.The results shows that capital allocation of China’s capital markets does not exist obvious distortion, as the lowering of proportion of state-owned shares, the sensitivity of capital flow to TFP is increasing, although the capital allocation functions weakened during Share Structure Reform period. The more competitive, the higher of capital allocation efficiency for sectors such as Textile and Apparel, IT and Biopharmaceutical, while the capital allocation efficiencies are lower in relatively more monopoly sectors such as Petroleum and Chemical, Electricity, Coal, Transportation, and Public services. Besides, the background of managements has no influence on capital flows, while the capital inflows are promoted by the proportions of non-circulating to some extent.After empirically analyzing capital allocation efficiency, the reasons for differences of resources allocation for different sectors are researched further, the results shows that systematic barriers in factors, resources and financial fields restrict allocation functions of china’s capital market.