A Research On Relationship Between Financial Development And Economic Growth In Hunan Province

Through the comparison of Hunan's economic growth,financial scale,financial growth,the industry contribution rate of finance,the efficiency of financial intermediation and financial structure with the other eight provinces in Pan-Pearl River Delta,we found Hunan's financial scale can match with its economic growth, but there are many problems with Hunan's financial development which indicate that a certain degree of financial depression exists in Hunan province.With the data of 1982-2007,a study on demonstrating test shows that there is correlation relationship between financial development and economic growth in Hunan province.On the basis of correlation study,we do Granger test by using the VAR model.The result of the research shows that financial development is the Granger causality of economic growth in Hunan Province,but economic growth is not the Granger causality of the financial development.The reasons of financial depression are as follows:poor financial ecological environment,poor degree of financial liberalization,less than the financial width and low level of financial industry.In order to solve these problems we should develop non-banking institutions and optimize the financial system;should vigorously develop the capital market and broaden the financing channels;should cultivate the introduction of talents and enhance financial innovation;should strengthen the support of financial industry to Hunan's dominant industries;should strengthen the cooperation of the Pan-Pearl River Delta regional cooperation and promote regional financial integration.