Research On The Existing Problems Of Chinese Debt Secondary Market Segmentation

Chinese government secondary bonds market has established in the late 80s of the last century. During the period of exploring to develop itself, the secondary market has experienced ups and downs, setbacks and honors. Undeniably, one fact has been proved by phenomena, which the number of transactions subject has increased, trading products has been continuously enriched, the trading system has been optimized continuously, supervision system has improve constantly:every advance in the secondary market is established in "making mistakes" and "making correction" step by step.However, the development level of the primary market and secondary market actually is in imbalance. In China, under this current economic system which is characterized by the fact that the national economy and the allocation of resources have been dominated by the government, the government’s focus on the secondary market is clearly not enough, especially the problem of market segmentation has become the biggest obstacle which restricts the development of the secondary market. Therefore, this paper has systematically studied the administration of the secondary market segmentation, on the basis of in reference to mature bond secondary market experience which comes from foreign developed countries, and puts forward effective measures and suggestions to improve secondary market and make integration of market segmentation.The logical framework of this paper is in accordance with the structure of the arrangement of the problem-raising, the problem-analyzing and the problem-solving.This paper has introduced the researching background, the researching question, the scope and content of the research, theoretical value and practical significance, possible innovation and deficiency, research methods and ideas.In the part of literature review at home and abroad, the paper, according to the different attitudes to Treasury bonds, has divided foreign scholars of theory research into three parts:negative, neutral and positive theory of debt. The domestic scholar’s research on the secondary market has focused on different aspects -- market segmentation, liquidity, micro player in the secondary market.In the present-situation-analyzing part which describes secondary market segmentation, the paper, firstly, has reviewed the institutional history of the secondary market since its establishment, and elaborated the fact from six aspects that market segmentation phenomenon has not yet been alleviated effectively---the segmentation of the market function, the segmentation of transaction subjects, the segmentation of the trading varieties, the segmentation of the trading system, the segmentation of regulators, the segmentation of bonds depository.In the causes-analyzing part which describes secondary market segmentation, this paper has mainly analyzed institution, market and policy reasons which causes the market segmentation from three aspects:the institutional public goods, main body of market microstructure and national debt policy.In the effect-analyzing part, the paper has mainly analyzed from three aspects of market regulation, depository and liquidity, that is, the market segmentation leads the situation of the imperfect supervision system, the segmentation of depository system the abnormal development of market liquidity. In this part, the paper has used two indicators include delivery volume and turnover rate to carry out empirically analysis targeted at the secondary market liquidity.In the institutional-economics-analyzing part, the paper has discussed administrative segmentation which is placed in institutional change of the framework, and analyzed the objective of carrying out institutional change, namely to use institutional economics to explain why the segmentation situation has taken shape, reducing uncertainty and making Pareto improvement. The paper has also analyzed the basic features of the institutional change in this current secondary market and the institutional flaws of the market segmentation. Finally, in the face of the future, the paper has analyzed the institutional changing power and resistance to integrate the market segmentation.Finally, in the part of policy suggestion, the paper has put forward the improving measures on the market segmentation:to disposal the interests of market parties in gradually; to call for government guiding secondary market institutional change and innovation on the basis of respecting market demand; to integrate segmentation of the market and change the situation of path dependence in the secondary market; to pay attention to the construction of the internal system and carry out the investor education.The improvement of the secondary market and the integration of the market segmentation, cannot be solved overnight. It requires not only correct top-level design, but also needs strong execution and close cooperation. This research is being hoped to provide sound policy suggestions and guidance for the relevant government departments to take improvement in the construction of secondary market and in order to serve the Chinese government bond market.