This paper analyzes the rational supervision behavior of the creditors by establishing the model and the supervision efficiency of the bondholders group based on the public choice theory, then comes to the conclusion that the interest of the bondholders'' collective action can not achieve Pareto Optimality in current China corporate bond market, due to the small size of institutional investors while the large size of the public investors dispersing all over the country. Therefore, the paper points out the two ways to achieve Pareto improvement: one is to foster the institutional investors, another is to choose a collective agent, functioning as the supervisor to resolve the “dilemma” of the collective action. At last, the paper proposes that the key factor to protect the interest of the creditors is to establish and improve the related laws as soon as possible, for the currently enforced the bond custody system lacks many basic operational systems.
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