A Study On The Correlation Between Financial Development And Investment Efficiency Of Shandong Province

Since the financial crisis broke out in 2008, the global economics has got serious threat. The Chinese government enhanced the investment strength to achieve the target of promoting the economic growth. In order to further increasing the governmental use rate of investment, the study on the investment efficiency problem seems to be more important. This text took the Shandong province for example to calculate the investment efficiency of the Shandong province.When the government selected the financial policy actively, it also further opened the currency policy, and did not implement the constrictive currency policy again, which enhanced the support strength to the financial development and increased the bank loan quantity. The traditional financial function theory holds the point that financial development could significantly promote economic growth, and this could be accomplished by its financial functions. Financial development release its financial functions, and these functions then promote the saving rate,saving and investment conversion rate and investment efficiency, and ultimately promote economic growth by the channel of capital accumulation and technological progress. However, under the current economic environment, would it make influence on the investment efficiency if enhancing the support strength to the financial development? If there is an influence, will it be produce the active influence as the forecast in the economic theory? This is the second problem that the text studied.This text selected the capital allocation efficiency as the assessment index of investment efficiency, and made analysis on the panel data,35 sub-industries in the statistics data in the Shandong province from 1993 to 2009. Through the empirical study, it found that the total efficiency of investment reached 0.495 in the Shandong province from 1993 to 2009, which was higher than the national average level. However, there was still great difference with the developed countries. It found that, there was obvious difference in the capital allocation efficiency in the 35 sub-industries in the Shandong province through the further study. Therefore, the text made the classification analysis on the sub-industrial data.Through the calculation of the capital allocation efficiency and analysis on the correlation between the investment efficiency and financial development of the Shandong province, the conclusion could be made that, the influence of the financial allocation efficiency to the development situation of the financial market was not obvious, that was, the total amount of the bank loan could not promote investment efficiency. While the financial marketization degree made the positive correlation function to the capital allocation, that was, the non-state-owned enterprises loan could promote investment efficiency of the Shandong province. At the end of the text, the author combined the empirical conclusion, and put forward some policies and suggestions on the upgrading of the financial development and efficiency of investment of the Shandong province.