The Mechanism?Effect And Policy Of Financial Development Affecting The Economic Potential Growth Rate Of China

As the core driving force of economic growth,finance not only affects the actual growth rate of the economy,but also affects the potential growth rate of the future economy.To improve the economic potential growth rate of China through financial development,we must clarify the following questions: First,how does financial development affect the potential growth rate of the economy? The second is how to capture the impact of financial volatility on the potential growth rate of the economy,that is,how to incorporate financial factors into the measurement of the potential growth rate of the economy? Third,is the potential growth rate of the economy including financial factors effective? Fourth,how should China's financial structure be adjusted to increase the potential growth rate of the economy? To solve these problems,we must grasp the following cores.The reference for judging the future economic trends should be the potential economic growth rate that includes financial factors,and the target of economic regulation should also be the potential economic growth rate that includes financial factors.This is both the core issue of this research and the innovation of this article.This paper regards financial development as the core driving force of economic potential growth rate,portrays the mechanism of financial development affecting the potential growth rate of the economy,captures the effect of financial development on the potential growth rate of the economy,and proposes countermeasures for financial development to increase the potential growth rate of the economy.From the perspective of theoretical model,explore the mechanism of financial development affecting the potential growth rate of the economy,and lay a theoretical foundation for the full-text research.The establishment of an endogenous growth model encompassing the financial sector demonstrates that the potential growth rate of the economy is positively correlated with the level of financial development,the productivity of the financial sector,and the productivity of the financial sector supporting the R&D sector.The potential growth rate of economies that do not include financial development support R&D mechanisms is lower than the potential growth rate of economies that include financial development support R&D mechanisms.Then explore the measurement method of incorporating financial factors into the potential growth rate of the economy,and capture the impact of financial fluctuations on the potential growth rate of the economy.Based on the latest financial cycle theory results,a potential economic growth rate measurement model suitable for China including financial factors is constructed.The output gap after financial factors adjustment has stronger practical guiding significance than the HP filter output gap.Both China and the transnational level stata show the same characteristics: the credibility and real-time forecasting function of the economic potential growth rate measurement model including financial factors is stronger than the economic potential growth rate measurement model without financial factors.In the past,empirical research on financial development to promote economic growth usually analyzes financial development and economic growth at both ends of the equal sign.This is the default for financial development as a result of economic growth.When using the economic potential growth rate including financial factors as the determinant of the explanatory variables to promote the financial development and increase the potential growth rate of the economy,we can break through the causal analysis hypothesis to directly explore the preconditions for the financial development to increase the potential growth rate of the economy.The policy recommendations are also more direct and effective.At the same time,this can further validate the empirical research value of the potential economic growth rate of financial factors.First measure the potential growth rate of economic factors including financial factors in China's provincial level and 19 countries.Then,the potential economic growth rate including financial factors and the economic potential growth rate without financial factors are taken as explanatory variables,and other influencing factors other than financial factors are selected as explanatory variables to construct panel regression models.Comparing the results of the two models,it is found that both the provincial level and the transnational level in China have confirmed that the model with the potential growth rate of economic factors including financial factors is more explanatory.The study finds that when financial development is used to increase the potential growth rate of the economy,if other non-financial key factors such as physical capital,human capital,technology,and institutional environment are more important,the fairness and openness of income distribution will be more conducive to financial development and economic potential.growth rate.Starting from the financial structure,the key link between financial development and potential growth rate of the economy is that the financial structure of a country should be actively matched with the industrial structure that meets the needs of future economic development.Based on the panel threshold model,based on China's municipal and provincial level data,the direction of China's optimization of financial structure in the future is to develop capital markets,and to clarify the nonlinear relationship between financial structure and potential economic growth rate.China's actual financial structure is On the right side of the optimal financial structure,highquality residents' living standards are the guarantee for the development of capital markets.Increasing the proportion of direct financing and developing capital markets are inevitable requirements for increasing the potential growth rate of the economy.The policy recommendations section analyzes the maintenance of financial development and the coordinated development of the real economy.Based on the previous research,it is clear that maintaining the pace of financial development and economic growth and maintaining efficient financial resource allocation efficiency are the key to promoting financial development and increasing the potential growth rate of the economy.Then from the perspective of constructing a macro-policy framework that includes financial stability objectives,continuing to promote financial structure optimization,improving the function of financial system service entities,and attaching importance to ensuring financial development to enhance the potential growth rate of the economy,these policy recommendations are put forward.