Analysis of the Development Path of China’s Multi-level Capital Market

（Law School，Beijing Wuzi University，Beijing 101149，China）

Abstract：How to design a multi- level capital market is a hot topic since the central decision- making department first mentioned“establishing a multi- level capital market”. The most important thing is whether dividing the market into different levels should be realized inside or outside the exchange，or both. In this regard，there are three viewpoints in the theoretical circle： internal evolutionary theory， external evolutionary theory， and unified evolutionary theory. Based on theoretical interpretation and legal & economic analysis，this difference in theoretical cognition mainly stems from different perceptions of local economic autonomy，the cost of designing multi- level capital markets，and the constraints of financial technology.The realization of the development of multi- level capital markets outside the exchange is mainly due to the consideration of local economic interests in the competition of central and local economic decentralization；and local political power institutions generally tend to support the establishment of multi- level "horizontal and multi- regional" capital market，but this development mode is most likely to lead to disorderly local competition.Realizing the multi-level of the capital market inside the exchange can reduce the cost of dividing the capital market into different levels，improve the supervision performance of the capital market，and avoid the local monopoly and division of the capital market，which should be our main direction for the development of the multilevel capital market in the future.Therefore，changing the OTC market into the exchanged traded market is a better construction mode for the development of the multi-level capital market.

Key words：securities；capital market；multi- level；dividing the market into different levels；transaction in the exchange traded market