Credit On Growth Of Jiangsu Economy

Financial played an important role in the process of economic growth. Finance mechanism of function can promote economic growth by absorbing the social idle funds through market mechanism. China's financial developing rapidly with China's financial system reform. But China's capital market scale is still smaller compared with bank credit. Social capital allocation is mainly completed by bank credit. The bank credit become enterprise's main financing channel. So, the research of the supply of credit and economic growth has theoretical significance and practical significance.This paper firstly summarizes the mechanism of credit on economic growth based on the theories of economic growth, monetary economy theory and the theory of financial development. Secondly use credit supply and economic growth of Jiangsu province as the research object and made an empirical analysis of credit supply and economic growth of Jiangsu province. Empirical analysis includes two parts. The first part use VAR model, Johnson cointegration test and VEC mode analysis the supply of credit scale and economic growth. The result shows that credit and economic growth influence each other, credit use efficiency and economic growth are related but the credit use efficiency is in a declining. The second part use the same methods analysis credit structure and industrial structure. The result shows that The credit structure and industrial structure influence each other. But in the supply of credit process of Jiangsu province also exposed the imbalance of using credit in industry, regional, term presents. The imbalances of using credit make the efficiency decline. In order to make Jiangsu credit promote economic growth more efficiently, Jangsu province should balance the development of financial market, adjust the credit structure and optimize credit regional supply.