Regional Heterogeneity Analysis Of The Impact Of Financial Development On The Scale Of Urban Investment Debt

In recent years,the scale of urban investment bonds has grown rapidly,and the accumulated potential risks have become increasingly serious,which has become a phenomenon that cannot be ignored in China’s economic and social development.Although there are many factors affecting the expansion of urban investment bonds,both the issuance and repayment of urban investment bonds are inseparable from the development of the financial market.In other words,the level of regional financial development will have a greater impact on the scale of urban investment bonds in the region.However,the level of financial development in different regions of China is quite different,and the regional heterogeneity of the impact of financial development level on urban investment bonds is worthy of our deep consideration.This article first reviews and sorts out relevant literature,and finds that some scholars believe that the lower the external financing constraints are,the easier it is for local government financing platforms to issue bonds in regions with higher levels of financial development.This article further analyzes the relationship between financial development and urban investment bonds,combines financial development related theories and urban investment bond related theories,and finds that the improvement of financial development levels has created favorable external conditions for urban investment companies’ financing and strengthened the urban investment companies in the region.The financing capacity,which promoted the issuance of urban investment bonds.It clarifies that financial development will have an impact on the scale of urban investment bonds by enhancing financing availability,reducing financing costs and diversifying financing channels.Then,this paper analyzes the current status and correlation of the current financial development and urban investment bond situation in various regions of China,and finds that there is a close relationship between the financial development of different regions and the development status of urban investment bonds.Then,this paper established an appropriate empirical model for analysis,and empirically tested the regional heterogeneity of the influence of financial development on the size of urban investment bonds,and analyzed the reasons for the regional heterogeneity.In this paper,the research sample mainly is the national 130 cities of regional urban construction investment company for debt issued by city size,the empirical results find that financial development and city under the whole samples present positive correlation between debt scale,the higher the level of regional financial development,the greater the carrying capacity of a debt on the city,urban construction investment companies in the region face external financing constraints,the smaller,more easy to debt financing,debt scale is relatively large.The results show that the financial development in the eastern,central and western regions is positively correlated with the size of urban investment bonds.The higher the level of regional financial development is,the greater the carrying capacity of urban investment bonds will be,and the scale of urban investment bonds will be relatively large.The improvement of financial development level will alleviate the external financing constraints faced by urban investment companies,so as to promote the growth of the scale of urban investment bonds,but there are some differences in the growth coefficient.According to the regression results of the fixed-effect model,for every 1% increase in the financial development level in the eastern region,the size of urban investment bonds will increase by 1.897 percent.For every 1% increase in the level of financial development in the central region,the size of urban investment bonds will increase by 0.150%.For every 1% increase in the level of financial development in the western region,the size of urban investment bonds will increase by 0.0931%.This shows that China’s regional financial development level difference,its carrying capacity of udic debt scale is different,different parts of the city investment company faces have different financing environment,the eastern region level of financial development on the city debt bearing capacity is larger,the Midwest regional financial development level of urban construction investment bonds carrying capacity is weak.This is mainly because the eastern region has a good financing environment,a developed financial market and a strong attraction to financial resources.Financing platforms can conduct financing through more financing channels,leading to a gradual increase in the debt scale.However,the external financing constraints in the central and western regions are relatively large,so it is difficult to issue bonds for financing,and the debt financing pressure is relatively large.It is difficult to find the financial channels to dissolve the debt burden in the financial market,which is not conducive to the sustainability of the debt,resulting in the weak carrying capacity of the financial development level of the central and western regions to urban investment bonds.Further discussion found that financial development effects on the city cast debt scale is closely related with the financial development level of the city,compared with the financial development level lower city,higher level of financial development of the city of udic debt bearing capacity is bigger,so for the low level of financial development,should be vigilant the debt scale expansion of debt risk.Finally,based on the research conclusions of this paper,in order to enhance the carrying capacity of the regional financial development level on the scale of urban investment bonds,to prevent the debt risk that may be caused by the expansion of the scale of urban investment bonds in areas with backward financial development,it provides corresponding policy implications for debt risk prevention and control.