The Influence Of Financial Development Of The "Belt And Road" Countries On Its Economic Growth

The total population of the countries along the "Belt and Road" account for 60%of the whole world approximately,it's total economic output account for 30%of the whole world.These countries are developing countries and emerging economies mostly,and they are in an ascending path of economic development.They have extensive and open cooperation with China.These cooperations have the prospect of mutual benefit and win-win situation.Finance is the core of the modern economy.It plays an important role in all aspects of the real economy,such as consumption promotion,investment promotion and trade promotion,as well as the circulation and diversion of capital,risk distribution,and information disclosure.In the implementation of the "Belt and Road" initiative,the role of financial development in economic growth cannot be underestimated.The road to economic growth in the countries along the route requires an important emphasis on the role of finance and investment in addition to infrastructure investment.With the development of the world economy,more and more developing countries are receiving attention and moving toward the growth path of emerging economies.Therefore,it is particularly important to study the economic growth of these countries from the perspective of the "Belt and Road" national financial development.Based on McKinnon and Shaw's theory of financial repression and financial deepening,this paper introduces a theoretical model of financial development that influences economic growth.Based on relevant theoretical analysis and examination of the status of economic growth in relevant countries,this article selects the final consumption rate of residents?capital input?R&D input as explanatory variables,applying the panel threshold model proposed by Bruce E.Hansen,taking the financial development level as the threshold variable,empirically analyzing the impact of financial development on the economic growth of 51 countries along the "Belt and Road" from year 1999 to 2016.The two-panel threshold model estimates the impact of financial development on the economic growth of the "Belt and Road" countries under the conditions of different levels of financial development.The results show that under different levels of financial development,the effects of the financial development of the "Belt and Road" countries on economic growth are significantly different,manifested as the threshold effect and diminishing marginal efficiency.At the same time,regardless of the level of financial development of the "Belt and Road" countries,the impact on economic growth is negative.This shows that financial development not only does not promote economic growth,but also restrains economic growth.Moreover,the form of this nonlinear relationship is different in different regions.Specifically,Southeast Asia has a higher threshold than West Asia and North Africa,West Asia and North Africa have higher thresholds than South Asia,South Asia higher than the Commonwealth of Independent States,and Central and Eastern Europe have the lowest thresholds.The financial development of the Commonwealth of Independent States has the greatest impact on economic growth,followed by West Asia and North Africa,while financial development in other regions has a certain degree of inhibition on economic growth.The diminishing efficiency of marginal efficiency is reflected in each region,but it is even more pronounced in Southeast Asia,Central and Eastern Europe and the Commonwealth of Independent States.Finally,based on the results of empirical analysis,the paper puts forward recommendations for the "Belt and Road" national financial development and economic growth.