Study On The Mechanism And Effect Of Financial Agglomeration On Regional Economic Growth

Economic development in China has become a new normal.Its economic structure optimization,development mode transformation,system and mechanism innovation will become the main theme of China economic development in the future.Finance is the core of modern economy.With the acceleration of the process of economic globalization,financial organizations continue to grow and grow.In some economically developed areas,local financial centers gradually formed like Beijing Financial Street,Lujiazui in Shanghai,and have become the backbone of enhancing regional financial competitiveness and new economic growth points.However,due to the difference of the present situation of our country,including the geographical resources endowment,economic growth and other aspects,the evolution mechanism of financial agglomeration,and the financial agglomeration effect on the scale and quality of the local area and surrounding provinces and cities economic growth has become an urgent problem to solve.This paper based on the relevant theoretical research at home and abroad,using knowledge of finance,regional economics,economic geography,econometrics,system dynamics,and software like Eviews,Arcgis,Geoda,Matlab,and Vensim,taking the economic and financial data of 30 provinces in China in the past few years,considering the spatial effect,and focus on three basic questions: the first is the financial agglomeration effect mechanism on the regional economic growth;the second is the financial agglomeration's effects on regional economic growth in the both the quantity and quality aspect;the third is the growth path of financial agglomeration affects the regional economic.The contents and conclusions of this paper are as follows:(1)The paper uses the domestic and foreign literature,to study and analysis the theories about financial agglomeration and economic growth systematically,and focuses on the financial development theory,financial agglomeration theory,economic growth theory and economic geography theory.It provides an important theoretical basis for this thesis to explore the basic conditions and effect of financial agglomeration on the regional economic growth.This paper summarizes the research results of domestic and foreign financial agglomeration,analysis and actual operation experience of international and domestic well-known financial centers,to provide useful experiences for China's financial agglomeration effect on regional economic growth.(2)Through the systematic literature review,this paper makes an in-depth study on the mechanism of the effect of financial agglomeration on regional economic growth.First of all,from the two aspects of internal motivation and external motivation of financial agglomeration,the paper systematically analyzes the formation mechanism of financial agglomeration,constructs the theoretical model of financial agglomeration,based on the two regional theoretical model of financial agglomeration,summed up the financial agglomeration market led pattern and government led pattern.Secondly,from the perspective of evolutionary economics,the process mechanism of financial agglomeration is discussed from two angles of dynamic process and static result.From the dynamic perspective,the path dependence of financial agglomeration will be divided into four main stages: formation stage,rapid agglomeration stage,stable development stage and the effect diffusion stage.From the static perspective,the paper defines financial agglomeration,namely the phenomena and results of financial talent,financial services institutions,financial research and financial information gathering and cooperation with the financial development.Thirdly,from the perspective of economic scale,the industrial innovation,the information and knowledge spillover,and self-reinforcing effect,analyzing the mechanism and effect of economic growth along financial agglomeration.It enriches the relevant theory of the financial agglomeration effect on regional economic growth,and makes the complexity and nonlinear hypothesis in the process of it.Fourthly,by constructing the LS model,we analyze the economic effects of financial agglomeration on regional economic growth,and provide an important theoretical basis for the study of the spatial effects of financial agglomeration on regional economic growth.(3)On the basis of the analysis of the development of financial industry in China and separate regions,this paper measures the degree of financial agglomeration in provinces and cities from two aspects: dynamic and static,and analyzes the current situation and trend of agglomeration.From the dynamic perspective,we set up a financial agglomeration evaluation system which contains three first level indicators and 12 second level indicators.The index selection includes the motivation,process,phenomenon and effect of financial agglomeration,and the entropy method is chosen to calculate it.This paper measures the degree of financial agglomeration in China's provinces and cities in the past few years.According to the calculated financial aggregation results,it analyzes the current situation and trend of financial agglomeration in the whole country and different provinces.From the static perspective,we choose location entropy index,to calculate the location quotient of banking,insurance and securities industry in the past few years to reflect the static structure of regional financial agglomeration.The results show that the quantity and quality of regional economic growth and financial agglomeration all increase with time,but the imbalance of economic development in eastern and western regions is more prominent.(4)The growth of regional economy is divided into two levels of quantity and quality,the Moran's I,the LISA index and the Gi index are used to analyze the spatial correlation of financial agglomeration and regional economic growth,and establishes the evaluation index system,and the empirical models,to test the space effect and nonlinear effect of financial agglomeration on regional economic growth.The empirical results show that: on the quantity of regional economic growth,financial agglomeration has a significant positive effect on economic growth in the region,but the diffusion effect on adjacent areas is not obvious;with the economic growth,the effect of financial agglomeration gradually increased.In the aspect of regional economic growth quality,the spatial econometric analysis failed to verify the financial agglomeration's positive effect on economic growth,and the spillover utility of adjacent areas is also poor;only in the area of a higher degree of financial agglomeration,the economic growth quality promotion effect is noticeable,on the other hand,in the area of low degree of financial agglomeration,"unreasonable financial agglomeration" will inhibit economic growth quality.(5)Based on the introduction of the basic connotation,key concepts,applications and modeling process of the system dynamics,the paper focus on the financial agglomeration mechanism of economic growth,from the capital,manpower,technology and other factors flow perspective,describes financial agglomeration effect path of regional economy.Thus we construct the flow graph of the elements of feedback mechanism and system,taking Tianjin city as an example,to test and simulate the authenticity of the system,in order to analysis the dynamic process and the path of financial agglomeration affect the regional economic growth.The simulation results show that,in the aspect of financial agglomeration,the simulation trend of location entropy in financial industry will remain stable in the future,while the quality and quantity of economic growth will keep steady growth.Through controlling system parameters to achieve the purpose of policy control.From the perspective of talent attraction,technology support and law perfection,we can see that policy optimization can bring positive effects on the operation of financial agglomeration-regional economic growth system.