Research On The Non-linear Influence Of Financial Regulation Policy On Economic Growth

Financial regulation policies are also known as financial repression policies in the field of finance.The key to their success is that financial regulation policies can effectively allocate resources.In the context of specific economic structure,financial regulation affects the development speed and quality of the real economy by affecting the allocation of funds.The transformation and upgrading of economic structure is also inseparable from the support of financial capital.With the transformation of China's economic growth mode and the entry of the economy into a new normal,it is necessary to explore new impetus for economic growth through economic structural transformation and upgrading.However,in China today,the role of market mechanisms in the allocation of financial resources is relatively limited.The impact of financial regulation policies on economic growth is not simple and linear,but there may be two effects at the same time.One is the “Mckinnon effect”.Financial regulation is not conducive to the improvement of financial efficiency,hindering economic and financial development,and thus does not contribute to economic growth.Second,the “Stigler effect”,that is,financial regulation helps to quickly convert savings into investment and financial stability,thus contributing to economic growth.In a developing economy,the “Mckinnon effect” and the “Stigler effect” may exist at the same time,but sometimes the former plays a leading role and sometimes the latter plays a leading role.In a country with a weak financial system and a regulatory framework to be matured,the financial market is liberalized,which is actually not conducive to economic growth and financial stability.Therefore,for China,“moderate” financial regulation may be a more appropriate policy arrangement.This paper is based on the background of economic structural transformation and upgrading,and studies the relationship between financial regulation and the speed and quality of economic growth.First,this paper uses the mathematical model method to explore the reasons for the government to choose financial regulation based on the perspectives of economic growth,social welfare,and the government's own interests.It also clarifies the internal logic of the government's choice of financial regulation intensity.Secondly,the author measures the national macro-level and provincial-level financial regulation indicators,and explores the relationship between the long-term economic growth rate and the intensity of financial regulation from the national macro level and the provincial level,and preliminarily tests the structural nature of the national macro level data.mutation.Finally,using industrial advancedization,rationalization,resource allocation efficiency,technological progress rate and urban-rural income gap as the proxy variables of economic growth quality,the non-linear relationship between financial regulation intensity and economic growth quality was initially explored,and financial regulation was also confirmed.There is indeed an optimal intensity of financial regulation in the process of affecting the quality of economic growth.The main conclusions of this paper are as follows:(1)The Chinese government's choice of financial regulation policies may promote economic growth.This is because the investment channels of residents are strictly restricted.Therefore,the Chinese government's choice of financial regulation policies can reduce the capital cost of stateowned enterprises and increase investment in investment.Conversion efficiency.In the economic take-off phase,due to the technical characteristics of the modern economic sector,the government's choice of financial regulation policies may increase social welfare,and the higher the marginal rate of return of capital,the better the social welfare improvement effect of the government's financial regulation measures.Capital inflows,monopoly profits of state-owned enterprises,government taxes,business risks,and interest rates are important considerations for the government to choose the intensity of financial regulation.The lower the government's regulation gains,the lower the financial regulatory tendencies.The higher the production efficiency of private enterprises relative to state-owned enterprises,the more the government tends to relax financial regulation.The greater the business risk,the more the government tends to relax financial regulation.The more serious the interest rate regulation,the more the government tends to increase the intensity of financial regulation.The greater the excess profits of state-owned enterprises,the greater the government's financial regulatory tendencies.The higher the government tax rate,the less propensity to choose a financial regulatory policy.(2)From the perspective of economic growth rate,in the long run,financial regulation as a whole is not conducive to economic growth,whether from provincial panel data or national macro level data.In the short run,the relationship between financial regulation and economic growth is not linear,and there may be an inverted U-shaped relationship.The increase in the output value of the service industry can effectively alleviate the negative impact of financial regulation on economic growth,and this effect is not linear.(3)Financial regulation as a whole will promote the upgrading of industrial structure.However,different levels of financial regulation have different effects on the promotion of industrial structure.There is an optimal level of financial regulation in promoting the upgrading of industrial structure.Fiscal expenditures can promote the rationalization of industrial structure,so the Chinese government can effectively promote the rationalization of industrial structure;the higher the proportion of fixed assets investment in state-owned economy,the more unfavorable the rationalization of industrial structure,the unreasonable property rights structure will become the rationalization of China's industrial structure.obstacle.Trade imbalances are also not conducive to the rationalization of China's industrial structure.The relationship between financial regulation and rationalization of industrial structure is not a strict linear relationship.There are multiple threshold effects between financial regulation and rationalization of industrial structure.In the relationship between financial regulation and rationalization of industrial structure,there is an optimal level of financial regulation.In the relationship between financial regulation and resource allocation efficiency,there is an optimal financial regulation intensity interval.Efficiency and fairness cannot be combined.Moderate financial regulation policies are the inevitable choice of “efficiency first and fairness”.The innovations of this paper are:(1)Theoretical innovation.In view of the reasons for the government to choose financial regulation,the mathematical model is established.Based on the perspectives of economic growth,social welfare,and self-interest,the reasons for the government's choice of financial regulation are explored.The internal logic of the government's choice of financial regulation intensity is also clarified.(2)Research perspective innovation.Using principal component analysis methods,eight of the four dimensions of financial regulation were selected to synthesize financial regulation indicators from a more objective perspective.(3)Method innovation.Based on the previous studies,combined with the analysis of the two "effects",the concept of optimal financial regulation intensity is further proposed,and the panel quantile regression is used innovatively to test the robustness.From the perspective of the speed and quality of economic growth,empirical analysis of the existence of the optimal financial regulation intensity.