The Research Of Development Of Internet Of Finance Based On Transaction Cost Theory

Internet of Finance is the emerging field that combines the traditional financialindustry and Internet technology.In recent years, the explosive growth of Internet ofFinance attracts the huge attention of the theory, finance, politics attention, influencesthe financial efficiency,transaction structure, even the whole financial system greatlyin China. However, domestic study of the development of Internet of Finance has justbeen started, and the understanding of the status, trends and levels of Internet ofFinance is also just staying in the divergent stage full of theories. So, there is greatimportance of theoretical and practical significance in researching, inspecting andevaluating the development trends of Internet of Finance innovatively, correctly andrationally, discussing on the existing problems that Internet of Finance develops inChina and furtherly focusing on countermeasures to the promotion of thedevelopment.This paper begins with a brief overview of the background of Internet of Finance,then sorts out and reviews the domestic and foreign literatures about transaction costtheory and the development of Internet of Finance. After assessing, summarizing thedevelopment, the main content and related research of transaction cost theorysystematically, the paper discusses the main forms of transaction cost of Internetof Finance, analyzes the external transaction cost, reviews the relationship betweentransaction cost and transaction efficiency, and puts forward the "three principles" tomeasure development level of Internet of Finance creatively, namelythe liquidity, profitability and safety, then furtherly analyzes the close relationsbetween the "three principles" and the the transaction cost of Internet ofFinance, including the improvement of liquidity,profitability and safety through theinformation processing technology, mobile payment technology and safety controltechnology,which are key factors reflecting the transaction cost or transactionefficiency, of course all of them can reduce transaction cost, improve transactionefficiency, thus improve the development of the Internet of Finance. Then from thenegative side of transaction cost, the transaction efficiency, it constructs the indexsystem reflecting the level of development of “three principles”. And combined withthe reality of development of China’s Internet of Finance, it discusses the levels andproblems of phases of development of China’s Internet of Finance by empirical econometric methods. Finally, based on the situation of development of China’sInternet of Finance and conclusions of this paper, we must take policy suggestions topromote the development of China’s Internet of Finance, specifically includingstrengthening the construction in information and standard of Internet of Finance,risk management systems of Internet of Finance and legal systems of Internet ofFinance.