Theory And Practice Of The Combination

The United States, Japan, Germany and other developed countries haveachieved rapid economic development by the combination of industry and finance.With the development of market economy of our country, the combination ofindustry and finance arose. In our country, the combination of industry and financestarted late but it is developing rapidly, especially in the context of economicrestructuring and financial system reform, the important of the combination ofindustry and finance is increasing. Therefore, the study of the combination ofindustry and finance become necessary.The paper combined the knowledge of finance, industrial economics andmanagement science, summarized the literature about the combination of industry ofdomestic and foreign, researched the theoretical of the combination of industry andFinance is necessary, analyzed positive and negative economic effects and impacts ofthe combination. So far, we had in-depth understanding of the theory anddevelopment of the combination.The paper analyzed the market-oriented combination mode represented by USA,Japan the main bank leading combination mode and German the universal bankcombination mode. Learned from the combination mode development experience offoreign countries and considered the national conditions of our country, we canchoose the mode that focus on the development of industry, because the current maincontradiction is financing difficulties in industry sector.In the empirical part, the paper first analyzed the transformation status ofsavings into investment from the structure of residents’ savings and investment ratio,and concluded that China has some savings precipitation and some savings did notconvert into investments and savings-investment conversion mechanism isinefficient. After that the paper analyzed savings-investment conversion rate fromthe perspective of the savings rate of return, then the paper analyzed the trend of savings rate of return in our country and three representative province of the eastern,central and western regions, and obtained that the more developed eastern andcentral regions had a lower savings-investment conversion and need moreimprovement at the savings-investment mechanism. Furthermore, the paper made aGranger causality analysis on the GDP growth rate and the savings rate of return inour country, and obtained that the savings rate of return was a granger cause of theGDP growth under the10%significance level, but the GDP growth wasn’t a grangercause to the savings rate of return.Finally, the paper discussed the problems in Chinese Combination of industryand finance from both macro and micro point of view, and also made solutionsaccording to our national current conditions.