On The Sector Distribution Of Capital In The Process Of Economic Growth

Economics studies the distribution of scarce resources. In developing countries capital is sure to be one of scarcest resources. So it is important to study the effective measures for distributing capital in different economic sector. Otherwise, the theory of financial development deepens the acquaintanceship of the importance that financial development stimulates the distribution of capital. However, we can find two aspects in theoretical deficiency: firstly, it is short of systemic summing-up that each genre treats the sector distribution of capital; secondly, it is short of research on the mechanism in which financial development effects the sector distribution of capital especially scarcity of research based on China. Two questions above form the theoretical base and reveal the topic of this paper: we discuss how to optimize sector distribution of capital by financial development in view of the theory of financial development, and we also probe into the mechanism in which financial development stimulates the sector distribution of capital basing on China.The paper treats the topic from currently to concretely and adopts the theoretical method and empirical method. First of all, we summarize the view about financial development effects sector distribution of capital in the outcome of the theory of financial development, with that we set up and set forth three theoretical model: for one thing, we build up a two-sector-model about capital good and consumption good; secondly, we set forth a two-sector-model about financial sector and industrial sector and find the endogenetic relationship of financial development, the sector distribution of capital and economic growth; finally, we new-classical bring production function of Galbis' model into endogenetic framework. We giveresearch into the relationship of the Chinese sector distribution of capital and financial development and discuss the sector difference from fixed asset invest and bank loan. Finally, we draw a conclusion that illogical system of financial development leads "sector discrimination of capital" although the development of financial structure positively effects the sector distribution of capital in some degree. So this thesis advises that China should make financial development "essential",so it is vital to keep the government rational in the process of financial development.Finally, this paper offers three points hereinafter as a conclusion. Firstly, this paper advances these viewpoints about the mechanism of financial development: a) the development of financial structure improves the sector configuration of capital; b) financial deepening intensifies the mechanism of cost-income about the sector distribution of capital; c) the theory of endogenetic financialdevelopment settles the ultimate power of the sector distribution of capital. Secondly, this paper analyzes the exterior effects of the sector distribution of capital that financial development leads and disequilibrium effects of financial development. Thirdly, the key of advancing the financial development is to keep the role of government rational so as to make financial development "essential". In sum, we should consider the disequilibrium effects of financial development and advance the market mechanism of the distribution of capital that financial development optimizes.Name:MaZheng-bing (Finance) Directed by-Wu Hai-hua...