A Research On The Transmission Channels Between Financial And Economic Growth Under Endogenous Growth Theory Perspective

In the modern economy, financial is a necessary access to higher economic growth rate, a sound financial system plays an important role in mobilizing savings, increasing investment and allocating the scarce resources efficiently. The rapid development of financial has effectively supported the rapid growth of the economy. At the same time, some new research results of economic theory, such as Endogenous Growth Theory, has established the basis to form the interrelation between the financial development and economic growth, which also has provided a new way to search and analysis the role of the financial system in economic growth.This paper, under the Endogenous Growth Theory perspective, aims to discuss how financial plays the role in economic growth. Based on Endogenous Growth Theory, this article will regard physical capital, human capital, technology capital, and institutional factors as the four main endogenous determine factors on economic growth. By the four endogenous determine factors on economic growth, based on the western region time sequence data, a group of regression model with financial indicators was built, in order to explore the internal conduction channels between financial effects and economic growth. Research results show that the capital stock, human capital and institutional factors is the three most significant endogenous conduction channels, capital accumulation is the main conduction channel between financial and economic growth; technology capital is not an influential channel. Based on the findings, as an example of the western region, for the impact of the four endogenous factors on economic growth, on how to play a better role in the conduction channel between financial and economic growth, this paper gives some corresponding policy recommendations.