Empirical Analysis Of The Network Externalities Of The Chinese Bank Card Industry

The bank card industry is a two-sided market composed of issue-market and acceptance-market.Different from one-sided market,the bank card market has the typical characteristics of two-sided markets.Similar to many industries,the development of bank card industry in China has a short history with a high speed.Its own characteristics and problems,are very worthy to be studied.And this industry is very closely related to people's daily life.Therefore,the research on this field is of great practical significance.In this paper,from the perspective of two sided market of bankcard,the history,market structure,classification and special characteristics of the bankcard industry are summarized.The characteristics of the 'co-opetition' structure of the'open type card organization' are noted.In the section of theoretical review,this paper summarizes the research results of the theories of 'two sided market' and the bank card industry,and some specific research points in the world and in China.Based on the bankcard industry and research situation,this paper puts forward the necessity of the research to Chinese bankcard industry' s characteristics and the related empirical test.And this paper points out that the'network externality' is the uppermost characteristic in the twosided market of bankcard industry.In this paper,the newest time series data the suitable econometrics methods were used.According to the test result,an important conclusion was got:The bankcard market in our country has obvious " network externality",and the overall strength is increasing.The strength of 'network externality' in the card issuing market is stronger than which in the card acceptance market,and the 'the quantity of issued cards' is the kernel variable in this study.In combination with the results of the two sided markets' characteristics test,and the research on the pricing mechanism,and considering the theme of better playing the characteristics of 'network externalities',this paper puts forward five proposals about China's bank card industry development,and some suggestions of the government regulation's direction.