Theoretical and Empirical Research on the Interaction between Pension Funds and the Capital Market - Also Discussing Policy Approaches for the Healthy Interaction between Chinese Pension Funds and the Capital Market

Author: Zhang Song
Publisher:
Publish Date: 2006-06-01
Features: This book focuses on the theoretical framework of the interaction between pension funds and the capital market. Based on theoretical and empirical research, it summarizes the general constraints for their benign interaction. Furthermore, building upon the theory and general constraints of the interaction between pension funds and the capital market, it discusses policy approaches to achieve a benign interaction between China's pension funds and the capital market, considering the actual situation of their interaction. Chapter 1 introduces the research questions, current domestic and international research status, research content, research objectives, research methods, and innovations of this book. Chapter 2 focuses on the theoretical research on the impact of pension fund development on the capital market. It provides theoretical explanations from three perspectives: social savings structure, asset portfolios of pension fund beneficiaries, and financial market equilibrium. Chapter 3 focuses on how the capital market promotes the development of pension funds. The growth of pension funds can be discussed through two pathways: new contributions and investment returns. The impact of the capital market on pension funds is primarily realized through these pathways. Chapter 4, based on the theoretical framework constructed in Chapters 2 and 3, employs the Granger causality analysis method to conduct an empirical analysis of the interactive relationships between the development indicators of pension funds and the capital market in 21 countries. Chapter 5 focuses on the theoretical and empirical research conclusions of Chapters 2, 3, and 4, summarizing the transmission effects and influencing factors of the interaction between pension funds and the capital market, and establishing a theoretical framework for their interaction. Chapter 6 shifts the analytical perspective to the interaction between China's pension funds and the capital market. Chapter 7, based on the current state of the relationship between China's pension funds and the capital market, analyzes the problems in China's pension insurance and capital market from an institutional level, as well as the constraints they impose on their interaction. This book argues that China's current pension insurance system must undergo structural adjustments, and the adjustment of state-owned enterprise property rights must be linked to the structural adjustment of the pension insurance system during the institutional transformation process. Chapter 8 first analyzes the main constraints faced by the interaction between China's pension funds and the capital market, which include the following aspects: first, the accumulation scale of pension funds is too small; second, the capital market is too small, structurally distorted, and inefficient; third, the financial system structure is unreasonable, with low integration; and fourth, the degree of interest rate liberalization is relatively low.