Research On Effect Of Cross-shareholdings To The Social Welfare Of Chinese Listed Companies

In the context of economic globalization, in order to avoid being eliminated in the competition,many companies joint with other companies to expand capital of scale,so they can complement advantages and enhance competitiveness. It promotes the development of cross-shareholdings by the increasingly fierce market competition, and the prevalence of economies of scale.It is necessary to strengthen theoretical and empirical discussion about cross-shareholdings between listed companies,so we can deepen the rational understanding of this economic activity and rich the economic basics of standards,in order to manage cross-shareholdings behavior between listed companies in China effectively.In this paper,on the basics of sorting out the domestic and foreign scholars’study, we analyzed how the cross-shareholdings between listed companies impact the degree of market competition and affect the total social welfare.The results indicate that in the same industry,if listed companies take part in the cross-shareholdings, the degree of competition in the market will be weakened, but the extent is not high. The market still maintain the original pattern.The total social welfare will enhance.If the listed companies in supply chain take part in cross-shareholdings, the degree of competition in the market and the social welfare will be enhanced,but the rate of increase is decreasing year by year.Finally, this article have proposed some suggestions for perfecting the cross-shareholdings between listed companies in China.