TITLE:
Research on the Dilemma of Speculation in Chinese Stock Market Based on Game Theory
AUTHORS:
Dexiao Ren
KEYWORDS:
Stock Market Speculation, Stock Market Investment, Game Equilibrium
JOURNAL NAME:
Theoretical Economics Letters,
Vol.6 No.4,
August
1,
2016
ABSTRACT: In this paper, the Chinese stock market is analyzed
from the perspective of participating in the game. Under the interaction of the
participants, the model forms two stable equilibriums. The ideal equilibrium is
that most people tend to invest in real investment rather than speculation.
Speculation is not the mainstream of the market, however, most people choose to
follow the trend of speculation, and the entire stock market speculation
prevails, that is also a possible equilibrium. This paper argues that the
current situation of Chinese stock market speculation is in a non-ideal
equilibrium, which most people choose to speculate, and the overall market
environment is inclined to choose speculation, and participants continue to
choose speculation, and market as a whole environment speculation prevails. As
long as the belief of participant to the market environment does not change,
they will not change their economic decision and the market environment will
still trend to speculation, which is why the guide of regulatory department
does not work and speculation in the stock market continues the root cause.