Study On The Influence Of Financial Industry Mixed Operation On Market Structure

Along with economic globalization and capital internationalization as well as the development of science and technology,in the face of foreign competition pressure brought by the development of financial industry mixed operation,China gradually relax regulation on financial industry,industry barriers between financial sector such as banking,securities and insurance reduced gradually.Besides,business segregation and difference between financial sector gradually blurred.Through the form of financial holding company and parent-subsidiary corporation.China's financial institutions enter the market to carry out the mixed management and provide savings,investment,finance and other financial products so as to meet consumers' diverse needs.Financial institutions provide hybrid products by the forms of mixed operation,which not only compete with the original enterprises,but also compete with the incumbent enterprises.The relationship between the financial industry's sub-industry gradually changed,which affected the market structure of the financial industry.However,how does the mixed operation of financial industry affect the market structure,and does the two organizational forms of mixed operation affect the market structure through the same mechanism?What has changed in the financial market structure?At present,the existing literature about financial mixed management on the structure of the market is mostly based on the level of financial sector,and a few scholars analyze different forms of mixed management's influence on financial market mechanism.Through panel data model,this paper measured explained variable with CR4.According to the sample number of business financial institutions involved in the industry,assignment respectively 1,2,3,this paper measured mixed management with virtual variables.And regression analysis was carried out on the empirical model by the software of Stata.First of all,this paper analyze the financial industry mixed operation's impact on the market structure.Secondly,the paper makes an empirical regression on the market structure of mixed operation.The research results show as bellow:(1)The concentration degree of financial industry is decreasing gradually,and the market structure type is transferred from middle and lower concentration oligopoly to low concentration oligopoly.(2)The mixed operation is negatively correlated with the market concentration degree.The higher degree of mixed operation of the financial industry,the smaller the market concentration is.(3)Mixed operation through financial holding company is not significant to market concentration.(4)Only when the mixed operation is high,the mixed operation in the form of the parent company will be significant to the market concentration and negatively correlated.Due to the development of the financial industry which closely related to many industries,if the financial industry develops badly,it will spread to the related industries and cause national economic instability.Therefore,reasonable financial market structure is vital to national economic development.Market concentration showed a trend of gradual declining,owing to the financial industry competition intensifying,this not only brings many difficulties to financial regulation,also easily causes the bad development of a financial enterprise risk which will spread to other companies.Therefore,considering the particularity of the development of the financial industry,it is necessary to strengthen financial regulation and strength financial institutions' ability of risk management and internal control.