Research Of Financial Policy In Developing Countries

Economic development is always one of the hottest topics in the economic. The author studied economic issues as well as financial policies, for exploring the role of economic development in government's function and financial policy. The sub-title reflects the basic points of the paper, that is, growth is the first goal in financial policy in developing countries. Fair distribution and economic stableness are very important to the development, and sometimes they are first considered. However, financial policy acts as "accelerator" in economic development in developing countries. China is one of the developing countries. Chinese financial policy should aim as mentioned above.Financial policy's role as "accelerator" will not be changed in the transit to market economic system. But the operation manner will be changed, that is, get effectiveness from market growth. The author compared the financial policies in developing countries and found the common points and problems in the financial policies in developing countries. The role of financial policy as "accelerator" is described as "development orientation" policy, significantly different from "need management" policy in developed countries. As the financial policy in developing countries is related to many areas, the author mainly discussed growth issue, including resource distribution, income re-distribution, and economic stableness. The author compared the financial policies in India, Egypt and Russia, and these can be offeredas the reference for positive financial policies in China.Productive capacity should be improved to increase supply ability if we need development. This is the major issue confronted the developing countries, and it is the fundamental issue that needs to be solved in the long development in Chinese economic. Productive capacity cannot be improved or can only develop slowly, with incomplete or immature market system or with nongovernmental effort. In the primary phases of the market economic development, government should cultivate market vigorously, improve market system, and fully make the market function well. On the other hand, the government should act as a coordinator when the market is incomplete or immature. Sometimes government has to take the place of some of market's functions, as the market is incomplete and immature. To understand this point is very important. It represents the logic that it is wise to develop sub-priority conditions when the priority conditions are not provided.