Differences and links between Chinese and Western financial institution systems

1. Connection:

The different cultural traditions of China and the West resulted in the differences in many areas of administration between the two later. China's centralized system was formed early, after the completion of the unification of the Qin Dynasty.

In the West, however, there was no effective centralization until the Middle Ages. Therefore, in Eastern China, the central government has long been in charge of ordering and restraining the local authorities, and the relationship between the central government and the local authorities has always been a subtle contradiction between the two.

Whether it is the monopoly of salt and iron in ancient times or the reform of the tax system after the reform and opening up, this contradiction between the central and local governments is clearly reflected.

Correspondingly, China's financial regulatory system is also structured according to a strict top-down logic, with "one line, three chambers" regulating various areas of the financial system from several aspects.

In a word, China's financial regulation is driven by the central government's need to stabilize the overall security of the financial sector, and thus ensure the stability of the country's fundamentals.

Difference:

The different financial systems in China and the West are determined by the different national socio-political systems in China and the West, with the West being an individual free capitalist economy, where the main body of market participants are private enterprises, and China being a socialist country, or an economic system with mixed characteristics under the leadership of the state capitalist system.

Western economic market economy has developed to the present, has been very mature, the modern financial regulatory system has also developed for hundreds of years of history, the very beginning is by the world's financial center, the Netherlands - the United Kingdom ---- United States .

In fact, now the world's countries around the world financial institutions set up and business regulatory model, as well as the financial industry are generally similar, are by Insurance ? The financial industry is largely similar, and is composed of insurance, securities and banking. The banking industry is composed of three major plates, the rest is the degree of financial innovation is not the same as the degree of development of financial derivatives is not the same. Western rule of law environment, regulatory environment is better and more perfect, their financial products are more, the industry is also more rich

Expanded information:

In contrast to the West, its cultural traditions on regional liberalism led to a delay in the creation of centralized power, so the West remained separate for a long time.

Later, with the rise of the nation-state, many Western countries established centralized systems one after another, but on the whole, Westerners still have a strong concept of local autonomy.

After entering the stage of market economy, many financial regulators in the West were established not because the central government wanted to regulate them, but rather because of the chaos and vicious competition in the market-oriented competition, which made these financial institutions gather together to discuss the establishment of a public discussion to maintain market order and balance the interests of all parties to the main body of the regulatory process, which led to the birth of the Federal Reserve and other institutions.

While Keynesian theories of government intervention have prevailed since the 1930s, the traditional Western tendency toward local and individual autonomy has always been present.