The Development of China's Stock Market and Stakes for the Global Economy (original) (raw)

A Preliminary Study of the Emerging and Developing Stock Market of China

Journal of Business Theory and Practice

The Chinese share market as an emerging and fast-growing listing venue has experienced a significant development since 2000.Prior studies on this market overwhelmingly concentrate on IPO-pricing-related and post-IPO performance-based propositions with lagging data. Adopting the updated data within the last couple of years, this paper comprehensively explores and accounts for some striking features of the Chinese stock market, and unfolds some new causes contributing to these characteristics. Some new findings are revealed. 1) Two new factors may lead to the extreme under pricing in China's market, which are the unseasoned investor sand their high demands of IPO shares. 2) The foreign-currency trading platform is not effective and efficient to attract the overseas investors. 3) The imbalanced industry structure of the listed firms is very significant, the Chinese share market is dominated by the manufacturing firms.4) The Growth Enterprise Market of China is essential to address the long-standing financing difficulties for the Chinese Small and Medium-sized Enterprises, which are unqualified to raise capital from the Primary Stock Market.

Demystifying China’s Stock Market: The Hidden Logic Behind the Puzzles

Demystifying China’s Stock Market, 2019

The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use.

Understanding China?s historical development: The profit and the risk that China?s stock market provides investors

Working Papers, 2009

The purpose of this paper is to describe China's unique historical development that transformed the Celestial Empire into the largest economy in the world in the beginning of the nineteenth century, with a GDP that exceeded that of Western Europe, Japan, the US and Russia combined, and the decline during the 'Century of Humiliation', and Mao Zedong's communism that culminated in the 'Three Bitter Years' from 1958 to 1961 that produced the large famine with an estimated death of 20 to 30 million people. After this disaster, aggravated by the 'Cultural Revolution' that followed, came the amazing growth started by Deng Xiaoping's economic reforms in 1978, that is only comparable to the United States emergence as an economic giant during the nineteenth century. China's sustained growth, at an astounding 10 percent per year over the last 30 years, is without precedent. Many economists predict this growth rate will continue at 7 to 8 percent per year for several decades. This extraordinary sustained growth was partially fueled by the formation of its rapidly expanding financial market, and the profit and risks that its stock marked provides investors.

The Real Value of China's Stock Market

SSRN Electronic Journal, 2000

for helpful comments and suggestions. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Recent development in China's financial markets: An introduction

International Review of Economics & Finance, 2010

Recent development in China's financial markets: An introduction☆ Since adopting reformist and open-door policy thirty years ago, Chinese economy has experienced tremendous growth particularly in the most recent decades. Along the path, we witness the development and structural changes in China's financial market. This special issue contains five articles spanning from macroeconomic to microeconomic topics related to China's financial markets. Specifically, what was the relationship between China's economic growth and financial development? How had soft budget constraints affected Chinese firms' investment decisions? What determined Chinese companies' R&D intensity? How did Chinese financial market interact with world financial system? What was the behavior of China's IPO market?

The effect of the liberalization of the Chinese stock market on returns

Applied Economics Letters, 2018

We examine the short-term effects of the liberalization of the Chinese stock market on returns. We find a positive and significant abnormal return associated with the announcement of the liberalization of the Shanghai Stock Exchange. Exploiting features of the reform, we are able to compare stocks directly and indirectly affected by the liberalization. We find that all stock prices reflect this announcement premium equally, suggesting that the premium does not reflect an increase in expected liquidity. We further find that observed liquidity, as measured by volume and price impact, did not increase following the liberalization. We conclude that the observed premium reflects a diversification benefit for Chinese investors.