Research On The Relation Between Financial Ecological Environments And Private Equity

Private equity fund (after referred to as "PE") is already becoming a fiercely competitive business when industrial is upgrading and restructuring, as the same time the level of capital market is well arranged, also for the economic growth model. The small and medium-sized enterprises are supported with public funds and social resources. Under these circumstances, whether foreign venture capital or local PE snatch the marketing share actively. Every province sets up government guidance funds, financial subsidies, the establishment bourse or OTC market to pave the way for PE. As an "imported goods", There will a joke of "South orange, North trifoliate" if only to copy the model of Europe and America pattern. Review the venture investment and failures in early China, the development of PE and application is not a simple "Takes Doctrine". It should be a long-term development strategy.Consideration of the economic development structure, marketization development level, the financial market structure, we build a financial ecological environment evaluation system with twelve representative provinces. Do an objective evaluation of the correlation between financial ecological environment and PE with principal component analysis and correlation coefficient. The results are as follows:(1) Financial ecological environment level evaluates every year with different speed, as the "backward" provinces Chongqing, Tianjin, Shanxi, Liaoning, Sichuan have the faster speed compared with Beijing, Shanghai, Zhejiang, Jiangsu. PE evaluation has the same results as public date.(2) From the point of whole body, the two shows a significant positive correlation. The correlation between PE and economic base, financial development relationship is not significant, while"social environment","government action" have more effect on PE.Policy Suggestions are as follows:New financial capital should play an important role in developing economic from the perspective of economic foundation with balance economic entity and virtual economy scale. From the perspective of financial development, traditional financial should support the development of new financial capital such as banks, trusts, third-party financial. From the social environment the point of view, support the development of the project entity economy with financial capital to discover value. Government guidance should be made to promote PE industrialization and specialization, more venture investment,it can also optimize investment and industrial structures.