Research Intofinancial Agglomeration And Its Influencing Factors In Shan Xi Province

During the 1980 s, with acceleration of globalization, financial industry stepped into a high-speed development period. Under the circumstance of international and regional financial resources flowing more rapidly, the financial enterprises formed a trend of mergers and acquisitions, so as to realize financial industry agglomeration. The dosmestic and international theoretical researches show that the financial industry plays an important role in enhancing the economic capacity within countries and regions, and financial industry agglomeration is helpful to promote the economic growth of the regions. But due to the differences existing in natural, cultural, and economic resources within regions, the degree of financial industry agglomeration is also different. Therefore, the promotion in different regions is a big difference. In particular areas, the effect of financial industry agglomeration is still worth studying in depth. As a big resource province, Shanxi Province has entered into a period of great development in its financial industry with economic development at the same time. But due to the impact of financial crisis, its GDP growth rate has continued to decline in the recent years. How to walk out of predicament and how to play full role of financial services in the process of economic transformation and optimization will become an important task for Shanxi Province in the future.Based on the theories of regional economics and industrial economics, this paper discusses the effect of financial industry agglomeration in Shanxi Province and its influencing factors by using the methods of descriptive statistics and spatial econometric analysis. The paper starts with the theoritical level of financial industry agglomeration and describes the concept and characteristics, and causes and influencing factors, and forms a multi-angle analysis based on the theories of the situation of Shanxi’s financial industry agglomeration, its agglomeration degree and the existing problems. Then, this paper constructs spatial econometric models, and uses relevant data in 11 cities in Shanxi Province from 2004 to 2013 to conduct empirical analysis of the influencing factors of financial agglomeration. Finally, the paper puts forward corresponding countermeasures and suggestions on enhancing the development of the financial industry in Shanxi Province.The paper draws the following conclusions through the research. First, the overall development of the financial industry in Shanxi Province is still relatively backward, and the overall financial agglomeration degree shows a downward trend with relatively low degree of financial agglomeration in regional cities. Second, within prefecture-level cities in Shanxi Province, Taiyuan City plays an obvious leading role in not only the financial resources but also the financial industry agglomeration, indicating that Taiyuan is the financial center in Shanxi Province. Third, the salary level, the ability to attract foreign investment, the level of economic development and the service industry output value percent accounting for GDP, etc. are the main factors affecting the degree of Shanxi’s financial industry agglomeration. These factors help to attract financial institutions’ settling down, significantly accelerate the process of high-frequency financial activities and industrial agglomeration, and generate a positive stimulus of the regions’ savings capacity and investment and financing needs. Fourth, the Shanxi government should actively improve the salary level, strengthen the attraction of foreign investors and promote the economic transformation, and rapidly develop the service industry, so as to promote the level of financial industry agglomeration within the regions.The innovation of this paper shows in two aspects. Under the measurement analysis method, the paper uses data of 11 cities in Shanxi Province, introduces the spatial linear panel model, and makes a more accurate analysis of factors in Shanxi’s financial industry agglomeration. Under the research results, it is proved that the impact of geographical proximity of the financial industry agglomeration in Shanxi Province is not significant, while the impact of economic distance is more significant. On the one hand, the paper enriches the research content of the financial industry agglomeration within regions based on the theories and methods. On the other hand, the paper is helpful to promote the development of financial service industry in Shanxi and plays a certain guiding role in practice in Shanxi’s economic restructuring development.