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An Empirical Study of Wealth Effect in China Stock Market
Author: ChenZuo
Tutor: HongZheng
School: Southwestern University of Finance and Economics
Course: Finance
Keywords: Consumption theory Wealth effect China stock market
CLC: F832.51
Type: Master's thesis
Year: 2010
Downloads: 77
Quote: 0
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Abstract
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China’s economy has developed rapidly in the past few years and the GDP has kept double-digit growth. The per capita GDP in 2008 has reached 3000 dollars for the first time and people’s living standard increased rapidly.many problems appeared. While the developing of China’s economy depends much on investment, import and export, the growth of consumption need especially residents consumption need is slow. It has become one of the most important problems that prevent China’s economy from developing.So it’s important to investigate China’ consumption theory and function, and apply it in guiding the drawing up consumption policy. In the process of investigate the consumption function, there’s an important problem that is the relationship between consumption expense and wealth property, that is whether there is an influence on residents consumption expense with the change of wealth property, so to speak, is there a wealth effect? Considering the remarkable growth of China’s capital market in the last 2 years,stock property has become one of the most main wealth forms for people.In this thesis, we mainly discuss the asymmetry in China’s stock market and wealth effect in different periods of time, and give some reasonable suggestions.。In this thesis, first we will discuss the theory basis of wealth effect.And from the consumption theory, we will come to the wealth effect. In fact, the development of wealth effect theory is similar to consumption theory. Then, we will analysis the wealth effect in the process of American stock market developing, and comparing it with China’s stock market to study the restrict reasons in China’s stock market wealth effect.。Following it, comes the key part of my thesis.We will use month data, quarter data, year data and so on to study the long balance relationship between stock price levels and consumption levels.And we will first practice and then study whether there is a wealth effect, including the whole, positive and negative effects,in China’s stock market.Then, we will use month data and quarter data to analysis how much the China’s stock market effect influences China’s economy in the different periods of time, including the positive and negative.At last, it’s the conclusion of this thesis.We will give a short illustration about the thesis, and give a conclusion of the studies above, and give some policy suggestions.
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CLC: > Economic > Fiscal, monetary > Finance, banking > China's financial,banking > Financial market
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