By Gao Wei　

Date: 2004/10/14

Abstract:

The exclusive characteristics of China's institutional risks of stock market show in the following aspects: 1. the high vulnerability of the market to policy changes; 2. key roles played by state-owned stocks which can easily induce institutional risks when the shares are reduced; 3. the serious defect risks related to the levels and structure of stock market; and 4. the incomplete legal system regarding stock market, and massive offense against the law and weak enforcement. The problems are rooted in the reversed growth procedure of China's stock market, the existing multiple responsibility, government monopoly and multiple roles of the government in the stock market.