The Research On Financial Support For China’s Urbanization

Currently,our country’s economy confrontinggrowth predicament.There are two main reasons for current situation,on one hand investment and exportlack of motivation;on the other hand investment and consumption close to the critical point.To slove the problem,our country has proposed to urbanization and put urbanization together with industrialization and informationization as the important way to expand domestic demand,optime the economic structure and transfer the mode of economic growth.Urbanization mean the human production and lifestyle changed from rural areasto urban type,the process of urbanization must be accompanied with the advance of the industrialization and economic development. Therefore,the financial,as a major force behind the economic development,will produce important impact on urbanization. From historical experience, the development of financial sector will promote the urbanization by financial institutions layout, credit funds, monetary policy guidance, financial institutions regulatory etc.Therefore,if we can discovery the mechanism between the urbanization and financial sector and differenteffects of different types of financial,we would provide better financial support to our urbanization.Our country scholars have done a lot of research on financial support forurbanization,while most of the research used Urbanization Ratio and Financial Interrelations Ratio as a measure of urbanization and financial support,which result statistical indicators sweeping.Meanwhile,most empirical tests adopted Granger causality test、Vector Auto-regression model and Vector Error correction model,while those models must have a lot of data to ensure correctness of the conclusion.But the changes of economic statistical indicators in our country, result in the data is inconsistent statistics even missing,an empirical test using the above method may bring wrong conclusion.To solve above problems,i refine the indicators of urbanization and financial, and introduce Gray Relational Analysis to solve small sample’s problem. Therefore,i think my articleprovidenew research idea and research data in indicators selection and method measurement to others.The paper point out internal logic between urbanization andfinancial support in second part. First, i think the most important characteristic of urbanization is the growth of urban population.According to thepush-pull theory,migration behavior is the interaction results between repulsive of evacuation areas and attractive of resettlement areas.This means that following conditions are necessary for urbanization:a large amount of surplus labor in rural areas,cities would provide appropriate employment opportunities to rural surplus labors,urban infrastructure construction can meet the migrant workers basic needs.Correspondingly,the financial sector has improved the efficiency of agricultural production by absorbing idle capital and allocating capital, which bring surplus labors in rural areas;The financial sector has provided a lot of funds to urban economy,especially the small and medium companies and services which produce a lot of jobs;The financial sector has provided a lot of financial support to urban infrastructure construction,which promotes the improvement of urban infrastructure facilities and provides more convenient servicesfor the new urban population.The paper demonstratethe above theory in the third part from our country’s actual situation, and analyze current urbanization problems in our country.The paper adopt Grey Relational Analysis to test the relationship between urbanization financial support in our country in part four,by the total amounts and quantitative analysis,the paper has the following conclusion:financial department has important support functions to construction of our country’s urbanization.However, different types of finance have different effects:policy finance is the main support for the construction of urbanization, commercial finance especially commercial banks becoming more and more important in the construction of urbanization,while the function of stock market is weak. In the last part,the paper propose appropriate policy recommendations to increase financial support for our country’s urbanization, so that finance can promote our country’s urbanization.