Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure

Li Jian; Lin Wenhao

doi:doi:10.11648/j.ijefm.20190704.13

| Peer-Reviewed |

Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure

Li Jian, Lin Wenhao

Received: 29 September 2018 Accepted: 27 August 2019 Published: 9 September 2019

Views: Downloads:

Download PDF

Share This Article

Twitter
Linked In
Facebook

Abstract

Since the reform and opening up in 1978, China has basically established a financial system that has adapted to the requirements of the market economy after several stages of financial innovation. Based on financial innovation events in China from 1979 to 2015, this paper compiles the structural index of China's financial innovation, and analyses the evolution trends and influencing factors of China's financial innovation structure. The index reflects the increasingly complexity and maturity of the overall structure of financial innovation since the reform and opening up, while the cumulative contribution of the six innovative forms to the changes in innovation structure has become more consistent and stable. The empirical analysis shows that the exploration of financial innovation is the continuous driving force to promote the change of financial innovation structure in China. What’s more, major reform decisions, opening to the outside world, as well as scientific and technological progress promote the structural change of China's financial innovation, while the financial crisis inhibits the structural change of China's financial innovation. The policy implication of this paper is that China needs to deepen reform, create a more suitable environment for endogenous financial innovation, carry out more original financial innovation, focus on promoting system, management and technology innovation, and pay attention to the selection of opportunity and window period of innovation.

DOI	10.11648/j.ijefm.20190704.13
Published in	International Journal of Economics, Finance and Management Sciences (Volume 7, Issue 4, August 2019)
Page(s)	107-124
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Financial Innovation, Event Study Method, Structural Index of Financial Innovation, Influencing Factors of Innovation Structure

References

[1]	Zhou Xiaochuan. The Development of Financial Reform AndIts Internal Logic [J]. Journal of Financial Research, 2015, 19: 11-17.
[2]	Li Jian. Structural Problems in China's Financial Development [M]. Beijin: China Renmin University Press, 2004.
[3]	Abiad A, Mody A. Financial Reform: What Shakes It? What Shapes It? [J]. The American Economic Review, 2005, 95 (1): 66-88.
[4]	Li Jian. Research on the Driving Force of China's Financial Development [J]. Journal of Financial Research, 1998, 7: 1-8.
[5]	Finnerty J D. Financial Engineering in Corporate Finance: An Overview [J]. Financial Management, 1988, 17 (4): 14-33.
[6]	Silber W L. The Process of Financial Innovation [J]. American Economic Review, 1983, 73 (2): 89-95.
[7]	Persons J C, Warther V A. Boom and Bust Patterns in the Adoption of Financial Innovations [J]. Review of Financial Studies, 1997, 10 (4): 939-967.
[8]	Bandiera, Oriana; Caprio, Gerard; Honohan, Patrick and Schiantarelli, Fabio. Does Financial Reform Raise or Reduce Saving? [J]. Review of Economics and Statistics, 2000, 82 (2): 239–263.
[9]	Kaminsky G L, Schmukler S L. Short-Run Pain, Long-Run Gain: Financial Liberalization and Stock Market Cycles [J]. Review of Finance, 2008, 12 (2): 253-292.
[10]	Ben-Horim M, Silber W L. Financial innovation: A linear programming approach [J]. Journal of Banking & Finance, 1977, 1 (3): 277-296.
[11]	Sametz, Arnold W. The new financial environment of the United States. In Edward I. Altman (ed), Handbook of Financial Markets and Institutions, 6th edn. John Wiley and Sons, New York, 1987.
[12]	Krueger, Anne O. Political Economy of Policy Reform in Developing Countries [M]. Cambridge: MIT Press, 1993.
[13]	Lora, Eduardo and Olivera, Mauricio. What Makes Reforms Likely: Political Economy Determinants of Reforms in Latin America [J]. Journal of Applied Economics, 2004, 7 (1): 99–135.
[14]	Haggard, Stephan and Webb, Steven B. What Do We Know about the Political Economy of Economic Policy Reform? [J]. World Bank Research Observer, 1993, 8 (2): 143–168.
[15]	La Porta, Rafael; Lopez-de-Silanes, Florencia; Shleifer, Andrei and Vishny, Robert. Legal Determinants of External Finance [J]. Journal of Finance, 1997, 52 (3): 1131–1150.
[16]	Levine, Ross; Loayza, Norman and Beck, Thorsten. Financial Intermediation and Growth: Causality and Causes [J]. Journal of Monetary Economics, 2000, 46 (1): 31–77.
[17]	Rajan, Raghuram G. and Zingales, Luigi. The Great Reversals: The Politics of Financial Development in the Twentieth Century [J]. Journal of Financial Economics, 2003, 69 (1): 5–50.
[18]	Ang J B, Kumar S. Financial Development and Barriers to the Cross-Border Diffusion of Financial Innovation [J]. Journal of Banking & Finance, 2014, 39 (1): 43–56.
[19]	Wu Jinglian. Bank Reform: the Most Important Part of China's Current Financial Reform [J]. China Economic Weekly, 2002, 12: 15-19.
[20]	Li Yang. China's Financial Reform And Opening up in the Past 30 Years: History, Achievements And Further Development [J]. Economics of Finance And Trade, 2008, 11: 38-52.
[21]	Wei Shangjin. The Main Points of China's Financial Reform [J]. Chinese Finance, 2015, 2: 12-14.
[22]	Wang Guangqian. An Analysis of Structural Problems in China's Financial Development [J]. Journal of Financial Research, 2002, 5: 47-56.
[23]	Wang Renxiang, Yang Man. Research on China's Financial Innovation Quality Indexes: Based on "Technology-Finance" Paradigm [J]. World Economy Studies, 2015, 7: 3-13.
[24]	Laeven, Luc. Does Financial Liberalization Reduce Financing Constraints? [J] Financial Management, 2003, 32 (1): 5–34.
[25]	Wang Shuo, Zhang Jiwei, Hawkan. An Exclusive Interview with Zhou Xiaochuan-Central Bank Governor Zhou Xiaochuan Talks about RMB Exchange Rate Reform, Macro-prudential Policy Framework and Digital Currency [J]. Caixin Weekly, 2016, (6): 52-61.
[26]	Zhou Xiaochuan. The Prospect And Path of RMB Capital Account Convertibility [J]. Journal of Financial Research, 2012, (1): 1-19.

Cite This Article

Plain Text BibTeX RIS

APA Style

Li Jian, Lin Wenhao. (2019). Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. International Journal of Economics, Finance and Management Sciences, 7(4), 107-124. https://doi.org/10.11648/j.ijefm.20190704.13

Copy | Download

ACS Style

Li Jian; Lin Wenhao. Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. Int. J. Econ. Finance Manag. Sci. 2019, 7(4), 107-124. doi: 10.11648/j.ijefm.20190704.13

Copy | Download

AMA Style

Li Jian, Lin Wenhao. Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. Int J Econ Finance Manag Sci. 2019;7(4):107-124. doi: 10.11648/j.ijefm.20190704.13

Copy | Download

@article{10.11648/j.ijefm.20190704.13,
  author = {Li Jian and Lin Wenhao},
  title = {Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {7},
  number = {4},
  pages = {107-124},
  doi = {10.11648/j.ijefm.20190704.13},
  url = {https://doi.org/10.11648/j.ijefm.20190704.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20190704.13},
  abstract = {Since the reform and opening up in 1978, China has basically established a financial system that has adapted to the requirements of the market economy after several stages of financial innovation. Based on financial innovation events in China from 1979 to 2015, this paper compiles the structural index of China's financial innovation, and analyses the evolution trends and influencing factors of China's financial innovation structure. The index reflects the increasingly complexity and maturity of the overall structure of financial innovation since the reform and opening up, while the cumulative contribution of the six innovative forms to the changes in innovation structure has become more consistent and stable. The empirical analysis shows that the exploration of financial innovation is the continuous driving force to promote the change of financial innovation structure in China. What’s more, major reform decisions, opening to the outside world, as well as scientific and technological progress promote the structural change of China's financial innovation, while the financial crisis inhibits the structural change of China's financial innovation. The policy implication of this paper is that China needs to deepen reform, create a more suitable environment for endogenous financial innovation, carry out more original financial innovation, focus on promoting system, management and technology innovation, and pay attention to the selection of opportunity and window period of innovation.},
 year = {2019}
}

Copy | Download

TY  - JOUR
T1  - Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure
AU  - Li Jian
AU  - Lin Wenhao
Y1  - 2019/09/09
PY  - 2019
N1  - https://doi.org/10.11648/j.ijefm.20190704.13
DO  - 10.11648/j.ijefm.20190704.13
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 107
EP  - 124
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20190704.13
AB  - Since the reform and opening up in 1978, China has basically established a financial system that has adapted to the requirements of the market economy after several stages of financial innovation. Based on financial innovation events in China from 1979 to 2015, this paper compiles the structural index of China's financial innovation, and analyses the evolution trends and influencing factors of China's financial innovation structure. The index reflects the increasingly complexity and maturity of the overall structure of financial innovation since the reform and opening up, while the cumulative contribution of the six innovative forms to the changes in innovation structure has become more consistent and stable. The empirical analysis shows that the exploration of financial innovation is the continuous driving force to promote the change of financial innovation structure in China. What’s more, major reform decisions, opening to the outside world, as well as scientific and technological progress promote the structural change of China's financial innovation, while the financial crisis inhibits the structural change of China's financial innovation. The policy implication of this paper is that China needs to deepen reform, create a more suitable environment for endogenous financial innovation, carry out more original financial innovation, focus on promoting system, management and technology innovation, and pay attention to the selection of opportunity and window period of innovation.
VL  - 7
IS  - 4
ER  -

Copy | Download

Author Information

Li Jian

The School of Finance, Central University of Finance and Economics, Beijing, P. R. China
Lin Wenhao

The School of Finance, Tianjin University of Finance and Economics, Tianjin, P. R. China

Download PDF

Sections

Plain Text BibTeX RIS

APA Style

Li Jian, Lin Wenhao. (2019). Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. International Journal of Economics, Finance and Management Sciences, 7(4), 107-124. https://doi.org/10.11648/j.ijefm.20190704.13

Copy | Download

ACS Style

Li Jian; Lin Wenhao. Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. Int. J. Econ. Finance Manag. Sci. 2019, 7(4), 107-124. doi: 10.11648/j.ijefm.20190704.13

Copy | Download

AMA Style

Li Jian, Lin Wenhao. Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure. Int J Econ Finance Manag Sci. 2019;7(4):107-124. doi: 10.11648/j.ijefm.20190704.13

Copy | Download

@article{10.11648/j.ijefm.20190704.13,
  author = {Li Jian and Lin Wenhao},
  title = {Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {7},
  number = {4},
  pages = {107-124},
  doi = {10.11648/j.ijefm.20190704.13},
  url = {https://doi.org/10.11648/j.ijefm.20190704.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20190704.13},
  abstract = {Since the reform and opening up in 1978, China has basically established a financial system that has adapted to the requirements of the market economy after several stages of financial innovation. Based on financial innovation events in China from 1979 to 2015, this paper compiles the structural index of China's financial innovation, and analyses the evolution trends and influencing factors of China's financial innovation structure. The index reflects the increasingly complexity and maturity of the overall structure of financial innovation since the reform and opening up, while the cumulative contribution of the six innovative forms to the changes in innovation structure has become more consistent and stable. The empirical analysis shows that the exploration of financial innovation is the continuous driving force to promote the change of financial innovation structure in China. What’s more, major reform decisions, opening to the outside world, as well as scientific and technological progress promote the structural change of China's financial innovation, while the financial crisis inhibits the structural change of China's financial innovation. The policy implication of this paper is that China needs to deepen reform, create a more suitable environment for endogenous financial innovation, carry out more original financial innovation, focus on promoting system, management and technology innovation, and pay attention to the selection of opportunity and window period of innovation.},
 year = {2019}
}

Copy | Download

TY  - JOUR
T1  - Index Measurement and Influencing Factor Analysis of China's Financial Innovation Structure
AU  - Li Jian
AU  - Lin Wenhao
Y1  - 2019/09/09
PY  - 2019
N1  - https://doi.org/10.11648/j.ijefm.20190704.13
DO  - 10.11648/j.ijefm.20190704.13
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 107
EP  - 124
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20190704.13
AB  - Since the reform and opening up in 1978, China has basically established a financial system that has adapted to the requirements of the market economy after several stages of financial innovation. Based on financial innovation events in China from 1979 to 2015, this paper compiles the structural index of China's financial innovation, and analyses the evolution trends and influencing factors of China's financial innovation structure. The index reflects the increasingly complexity and maturity of the overall structure of financial innovation since the reform and opening up, while the cumulative contribution of the six innovative forms to the changes in innovation structure has become more consistent and stable. The empirical analysis shows that the exploration of financial innovation is the continuous driving force to promote the change of financial innovation structure in China. What’s more, major reform decisions, opening to the outside world, as well as scientific and technological progress promote the structural change of China's financial innovation, while the financial crisis inhibits the structural change of China's financial innovation. The policy implication of this paper is that China needs to deepen reform, create a more suitable environment for endogenous financial innovation, carry out more original financial innovation, focus on promoting system, management and technology innovation, and pay attention to the selection of opportunity and window period of innovation.
VL  - 7
IS  - 4
ER  -

Copy | Download