Research On The Correlation Between Regional Financial Risk And Regional Economic Development

Economic financialization is the typical feature of the modern market economy,and it is natural of the uncertainty in the economic development process,which brings about the financial risk everywhere.With the deepening of economic globalization and international integration of international finance,regional financial risks can spread globally.In the economic reform and the development of our country at present,influenced by the three periods of superposition effect,economic structure and financial markets are going through great changes,which not only effect the transformation of industrial structure,but also lead to the economic gap among different regions.Besides,the differences in regional economy directly affected the regional financial development.Structure difference,complementary advantages and association in regional finance constitute the regional financial system of country,the development of regional finance,actually,is a process that the financial innovation and financial risk management compete with each other.Considering the inter-connectivity provided by modern economy,regional financial risk may spread to all areas with an unprecedented pace and destructive power,thus causing a great loss.As a result,the recognition and management of regional financial risk is the requisite of regional economic stability and development.Frequent outbreaks of corporate debt default,financing chain rupture and bank credit quality in recent years,in fact,show that risks in regional financial in certain provinces are expanding,although they seem to be the results of credit problem in enterprises.The severity and complexity of potential financial risk in all areas in China are fully demonstrated by "measures for preventing regional financial risk" put forward in 2012 Central Economic Working conference in 2012 and "eliminating risks and levers"brought out by "one bank,three councils".Regional financial risks are the reflection of various contradictions accumulated in long-term accumulation economic development in a certain region.Focusing on financial risk and regional economy,and starting from the research on the essence of financial fragility,the thesis conducts an in-depth analysis on the relation between financial risks and economic development.In the process,it involves the cause,spread,recognition and prevention of regional financial risk.Risk index on the basis of analyzing statistics in 31 provinces panel data,and feedback mechanism are also adopted.The results prove that the financial risk index has better forecasting function for the future economic situation,and economic growth is intertwined with,rather than independent from,risk management,in the short term,there is an obvious mutual promotion effect,while the economic effect of financial risk in the long term is negative.At last,it offers suggestions such as maintaining a great economic development,improving the multilateral system of financial markets;strengthening risk management and supervision via coordinating capital markets in different regions,enhancing social credit system;improving regional allocation efficiency and exploring new paths for the development of regional financial markets.