The Empirical Study On Regions Financial And Economic Development Of Hebei Province

Economic development history of countries all around the world all indicate the fact thateconomic growth is closely related to financial development. And many scholars havedevoted to the relationship of them，which can be generally divided into three groups: onegroup insist that financial development can promote economic growth. On the contrast,another group declare that actually financial development is affected by economic growth.However, the rest part of the scholars think these two elements are interdependent with eachother. Although there are so many disputes about the relationship of financial developmentand economic growth, economists and statesmen all insist that financial development impactsa important influence on economic growth, it is the core of modern economy, and the mostimportant part of modern market economy. Nowadays, many literatures study on therelationship of financial development and economic growth, however, there is hardly any tostudy particularly on the regional financial development and economic growth of HebeiProvince. Therefore, this thesis is going to carry on a systematic study about the relationshipof financial development and economic growth in Hebei Province.With simultaneous equation model and panel data model, this paper analyses therelationship between financial development and economic growth from financial developmentscale and financial efficiency, and mainly use the empirical analysis and supported bytheoretical analysis. The first part of this thesis analyses the current status of the Hebeiprovince financial development from three different aspects: overall development scale ofthe whole province, development level of different regions in Hebei province and comparingwith other provinces. The result shows that Hebei province carries on a relatively stable andfast financial development in recent years, however, still lags behind other developed regions,and also with a difference of deposit and loans scale between different regions of the province.The second part of this thesis makes a simultaneous equation model, and analyses financialdevelopment and economic growth base on it. According to the result, financial developmentcan promote economic growth, financial efficiency will hinder the economic development,imports,exports and fixed investments can accelerate economic growth. And financial size canpromote the financial intermediary efficiency, so did the imports and exports. The third part of this thesis makes a panel data model with the data of11prefecture-level cities and a furtheranalysis from aspects of cross section and time, meanwhile, selects individual fixed effectvariable intercept model with variance components method and Hausman method. Based onthe panel data model, it shows that the financial development can promote economic growth,but financial efficiency has little effect on it.From the overall research of this thesis, it comes to the final conclusion that financialdevelopment can promote the economic growth, but financial efficiency can not promote theeconomic growth due to inappropriate credit fund release. To sum up, reasonable optimizationof credit resource is necessary.