The Inclusive Effect Of Financial Market Competition

Today,the gap between the rich and the poor is widening,and financial exclusion is rampant.Inclusive Finance is a new type of inclusive financial system to solve the gap between the rich and the poor in today’s world and to fill the gap in the traditional financial supply.Its purpose is to enable every individual to obtain the required financial services at an affordable price.By introducing Xiong Deping(2017,2018),this paper puts forward two concepts of "active inclusive" and "passive inclusive",which are the driving force of inclusive financial development,and calls the spontaneous inclusive effect in the normal operation of financial market "passive inclusive effect".This paper discusses the sustainability of "passive inclusive" to the development of Inclusive Finance,and studies why and how the "passive inclusive effect" comes into being in combination with the competition degree of financial market.In order to clarify the cause of "passive inclusive effect",this paper uses Friedman’s core edge model analysis paradigm and Lewis’ s dual economic theory to divide financial market into strong financial market and weak financial market,and explains the mechanism of inclusive effect in financial market competition by combining murdar’s analysis tool echo diffusion effect and marginal diminishing return law.In the definition of financial market,this paper draws on the existing relevant research.In order to make the research results more in line with the objective of international comparison,we choose to define the financial market as a whole financial market which takes both direct and indirect financing markets into account from a macro perspective.As for the selection of financial market competitiveness variables,because the traditional indexes such as HHI,learner index and H statistics are limited in data and can not achieve good results in cross regional comparison,they are abandoned as the measurement variables of financial market competitiveness in this paper and selected Raymond W Goldsmith,1969)proposed financial correlation rate(FIR)as an agent variable to measure the competitiveness of financial markets in various countries.Based on the international perspective,this paper analyzes the relationship between financial market competition and inclusive effect.Panel data of 43 countries from 2013 to 2017 are selected for empirical analysis.The research data shows that the development of Inclusive Finance in China has developed rapidly in the past five years,from the third lowest in the sample countries in 2013 to the top 10 in the sample countries in 2017.One of the main reasons is that the government has strengthened the construction of China’s credit system,and the Gini coefficient of China has also declined in the same period.The panel fixed effect model is used to analyze the data.The results show that the size of financial market competition has a significant positive impact on the size of its inclusive effect.In order to eliminate the result error caused by endogeneity in the model,the dynamic panel model is used to test the robustness,and the sign direction and significance of the financial market competitiveness in the results of the robustness test remain unchanged.The urbanization rate also has a positive effect on the development of Inclusive Finance.In order to study whether the level of financial market competition will have a heterogeneous impact on the inclusive effect,this paper divides the sample countries into high and low sample groups according to the median of financial market competition,and conducts empirical tests,the results show significant differences.In the empirical analysis of the sample group of countries with low financial market competitiveness,there is no obvious relationship between the financial market competitiveness and the development level of Inclusive Finance.When the sample group of countries with high financial market competitiveness is selected,the financial market competitiveness can have a significant positive impact on Inclusive Finance.When comparing the effect of government behavior and financial market,we find that the effect of urbanization is obvious.This paper draws the following conclusions through empirical analysis: first,there is a significant positive correlation between financial market competitiveness and inclusive financial index in the selected sample countries from 2013 to 2017,that is,the increase of financial market competitiveness can produce inclusive effect,and has a positive correlation,which is consistent with the theoretical analysis and hypothesis of this article;second,there is a premise for financial market competition to produce inclusive effect The condition is that the development level of a country needs to reach a certain degree,and only when there is a high degree of financial market competition can the promotion of financial market competition produce the inclusive effect.In the selected sample countries from 2013 to 2017,the level of financial market competition will have heterogeneity in the generation of inclusive effect;thirdly,the inclusive financial development mode of "market + government" is worthy of praise,but the government needs to select its own driving point,so as to maximize its contribution to inclusive financial development.