Abstract: Under the current situation in China, it is inappropriate to take fundraising as the direct and main goal of reducing state-owned shares, and raising social security funds should only be a secondary goal of reducing state-owned shares. Resolving the obvious institutional deficiencies in China's economic structure and improving the efficiency of resource allocation is the overall and strategic significance of the circulation of state-owned shares.

Keyword: State-owned shares; Circulate; Resource allocation; Corporate governance structure