A Theoretical And Empirical Analysis Of The Effect Of Security Market On The Economic Growth Of Hunan Province

In modern market economy, production elements market plays an improtant role in the allocation of resources and operating efficiency of the whole economic system. The third Plenary Session of the 16th Party Central Committee has proposed developing the capital market and other factor markets. As the principal and leading part of the capital market, security market connects real economy and virtual economy, and influences the marketability progress of China's economy. Security market has made a rapid progress and achieved a certain size, which make it play a more and more improtant role in the national economic growth,restructuring and structral adjustment of state-owned economy. However, compared with developed countries, the security market of China, which is an emerging market and is on the stage of transition, has a series of problems. These problems make the security market have difficulties in achiveing prospective effect in market economy and thus make the roles of the security market be doubted. Therefor, there are issues about whether the security market affects the economic growth of Hunan province,what's the size of this effect and how to improve and perfect the security market of Hunan province, which deserve in-depth research of the academe of economy and finance of Hunan province.There are four sections in this paper. In the first section, we analyze the correlated researches and results about the effect of security market on economic growth in numbers and comprehend and possess the advancing front of this issue, which provide a basis for this paper. In the second section, we investigate the mechanism and approaches of the effect of security market on economic growth and analyze qualitatively the effect of security market on Hunan's economic growth. In the third section, we classify the sources of growth into two categories, quantity factors and quality factors. Then we set a model of Hunan's economic growth which reflects the effect of security market and finally empirically analyze approaches from which the security market affect Hunan's economic growth. We find that the enhancement of security market's liquidity has improved the investment and technology advancement and has further enhanced the economic growth rate of Hunan Province. In the forth section we apply Cointegration test and Impulse response into analyzing the long term dynamic relationship between the security market and econmic growth of Hunan province. The results indicat that there is a long term equilibrium between the liquidity...