Financial Capital,Market Size And Regional Innovation Ability

With China's economy entering a period of new normal,Regional innovation ability has become the core power for developing regional economy.At present,China's current level of innovation is still relatively low,and China has a vast territory,there are differences in the development of innovation ability between regions.This paper starts with two aspects of financial capital and market size,and makes an empirical study on the internal relations between financial capital,market size and regional innovation ability.The article first defines the concept of regional innovation ability,financial capital and market scale,and reviews and combs the relevant literature as the logical starting point of this paper.In the empirical test,the panel data of 31 provinces in China in 2004-2014 for 11 consecutive years were selected as the research samples,and the simultaneous model was established to test the six research hypotheses,and by estimating the single-equation regression Method and the system estimation method,the system estimation method is finally selected to eliminate the errors caused by the random perturbation between different equations.Regression estimation of the national level sample data by simultaneous equations model,As well as the eastern,central,Western and northeast of the four regions of the sample data were estimated separately and compared the difference.The results show that:(1)between financial capital and regional innovation ability is mutual promotion,but the effect of financial capital on regional innovation ability is mainly reflected in the central and western regions and northeast region.(2)The market size have a negative effect on the regional innovation ability at present,affect the regional innovation ability on the market size is not significant.The reason for this result is the upgrading of the industrial structure in China is slow,the second industry is the main processing labor intensive and resource intensive manufacturing,the market size increases when the enterprise will focus on the scale of production and innovation activities being neglected.(3)There is a mutual promotion relationship between financial capital and market size,but this relationship is mainly reflected in the eastern region.At last,this paper puts forward some policy suggestions on the influence of financial capital and market size on regional innovation ability.