The Research On The Relationship Between Chinese Local Government And Regional Financial Development

With the speeding up of the market, Finance as the core of modern economy has become increasingly prominent in the national economy. However, as an emerging market economies, Regional development of financial industry faces the reality of the widening gap. In recent years, statistics has shown that the speed of financial development in eastern China was faster than that on central and western regions from the indicators of the financial interrelation ratio, distribution of financial institutions and practitioners, financial assets and capital market development and showed a non-convergence characteristics. The expansion of the regional differences in financial development betweeen East and Midwest region will inevitably lead to differences in regional economic development, thereby affecting regional economic development and the construction of harmonious society.China is an emerging and transitional market economy. To some extent,the policy of the reform and opening up was a result of regional differences in financial development. Therefore, As the main body of the regional system of innovation,the study of regional financial differences should be based on the differences in local government behavior. This paper based on fiscal decentralization and System Transformation discusses the regional financial development from the perspective of local government.This paper is divided into five chapters. The first chapter includes background and significance of the topic, literature review, research methodology and framework. ChapterⅡis the discussion on China's inter-regional differences in the level of financial development,Mainly from the degree of financial deepening, financial System, financial assets and the degree of participation in the capital market and other indicators on the different economic regions. ChapterⅢis the discussion on the formation mechanism between local government behavior and regional differences in financial development from the perspective of regional economic disparities and financial ecological environment. Chapter IV is the discussion on Local government behavior of different systems and different economic regions and analyzing its positive and negative effects. The last chapter based on the analysis of the previous chapters propose some policy recommendations on optimizing the behavior of local governments and promoting regional financial development.