Knowing But Not Doing? The Institutionalization of Financial Know-How in China

This article focuses on the organizational practices of traders in the Chinese OTC derivatives markets, the knowledge and techniques they use, and their perceptions of the markets. Such analysis is seen as prism through which to get a larger view of the ongoing expansion and institutionalization of Chinese financial markets and their global integration. The article discusses the mechanisms behind the transfer of expertise and technology (e.g. pricing models) from Western markets into China and the dissemination of this knowhow within the Chinese financial sector. Existing research has shown that organizational practices in Western derivatives markets have been heavily structured by these knowledge and technologies. It is however clear that the expertise and technologies have limited applicability to Chinese financial markets which poses questions regarding the impact on organizational practices. The central question which the article attempts to answer is therefore what, if any, role or function the transferred knowledge has.