Study On The Influencing Factors Of Financial Structure Evolution And Its Effect Of Economic Growth In China

A great number of scholars have carried on a large amount of research on the financial structure in different countries since Goldsmith put forward the theory of financial structure in 1969.Because of the diversity of economic system and the different level of economic development,countries have distinct evolution paths and financial structure types.At present,China is in the crucial period of deepening reform and supply-side reform of finance.Financial structure is not only an important factor that affects the economic structure,but also a key factor that affects economic growth.Therefore,the adjustment and optimization of the financial structure and its adaptation to economic structure have become the most concerned issue of the academic community and the policy-making government of China,so have the promotion of the economic development which should be innovative,harmonious,low-carbon,open and shared.Based on the provincial panel data of China,method of PVAR applied to the empirical study on the factors that affect the evolution of Chinese financial structure.Furthermore,the paper empirically analyses the effect of financial structure evolution on the economic growth from four aspects of the whole country,the east,the midland and the west based on the Cob-Douglas production function.The arrangement and framework of the dissertation is as follows.Chapter 1: it introduces the background of the research and raises the question to which we pay attention.In addition,the theoretical and practical values are discussed in this chapter.Moreover,it presents the content framework,technical route and research methods of the paper.Chapter 2: it reviews three fundamental theories including the theory of financial structure,the theory of financial development and the theory of economic growth.Chapter 3: it mainly analyses the theoretical framework of financial structure and economic growth.First,it defines the connotations of financial structure and its evolution.Second,it theoretically analyzes the factors that have an influence on financial structure evolution.Third,it illustrates the internal mechanism of financial structure evolution to promote economic growth.Chapter 4: it reveals the factors that affect the financial structure evolution by using methods of PVAR,impulse response and variance decomposition.Chapter 5: it exams the effect of financial structure evolution on economic growth,and a comparative research has been conducted among the country,the east,the midland and the west for deep results in different regions.Chapter 6: it summarizes the conclusion of the paper and proposes some suggestions to optimize the financial structure to achieve a solid and robust economic growth.The main conclusions of the paper locate on the following five points:(1)The financial structure evolution of China is largely affected by internal accumulation,which indicates that the path dependence and self-driving within the evolution of financial structure are obvious.In the long run,the own forces of financial structure will weaken gradually while the impact of the outside factors will strengthen little by little.Therefore,we draw a conclusion that China's evolution path of financial structure has transformed from the previous supply-oriented model to the current demand-guiding type.(2)Except for self-driving,there are still other elements that have deep influence on the financial structure evolution: economic scale,economic structure,legislation,technological progress,government intervention and the degree of economic openness.(3)The future trend of the factors that affect the financial structure evolution is that laws and regulations will play a more powerful role in promoting the evolution of financial structure and the technological advance will become a long-term motivation.(4)There is a close relationship between the financial structure evolution and economic growth.Specifically,financial structure evolution has a significant positive effect on the economic growth no matter based on the nationwide data or regional data.(5)The hardware foundation of financial market,the perfection of financial laws and regulations and the operability and convenience of financial instruments are the important reasons lead to the unbalanced distribution of financial resources.Based on the above results and conclusions,six policy proposals are put forward.(1)In order to form a benign and balanced interactive evolutionary relationship between economic structure and financial structure,we'd better promote the development of endogenous financial organizations in consideration of the economic structure demand and accelerate the development of direct finance.(2)Continually strengthening the marketization process of the financial system;improving the operation and supervision mechanism of financial market;enhancing institutional guarantee of financial structure evolution.(3)Increasing the investment in technological innovation and mastering core technologies.Only in this way can we get rid of the dependence on technology import,upgrade the industrial structure,accelerate the development of equity finance and guide the transformation and upgrading of the financial structure.(4)Implementing deepened financial policies under the strict condition of regulations,making the economy running in an easier financial environment,increasing the economic vitality and efficiency,weakening the administrative intervention of local government,fully taking advantage of the decisive role of market in allocating resources.(5)With the help of economic and financial opening,appropriately adjusting the economic dependence on the foreign market;absorbing foreign advanced technology and management experience;scientifically evaluating the impact of foreign-owned enterprises;reasonably distributing the foreign financial institutions;promoting the optimization and upgrade of financial structure.(6)Facilitating the innovation of different kinds of financial parts;accelerating the steady development of non-bank financial sectors such as assurance and insurance;improving the risk-sharing mechanism of financial development.