The Research On The Correlation Between Financial Development And Residents’ Income Level In 11 Provinces Of The Yangtze River Economic Belt

Since the reform and opening up,with the rapid growth of China’s economy,the income level of domestic residents has shown an upward trend and the level of financial development has been improved accordingly.The Yangtze River Economic Belt covers11 provinces and cities in the East,West,and Central regions of China,with a population and GDP of more than 40% of the country,playing an important role in supporting China’s economic development.This research examines the interrelationship between financial development and income levels of residents in 11 provinces and cities in the Yangtze River Economic Belt,which is of practical and theoretical significance.This research takes 11 provinces and cities in the Yangtze River Economic Belt as the research objects.Firstly,the literature on financial development and residents’ income level is sorted out,then the relevant theories on financial development,residents’ income level and the interrelationship between them are organized and discussed in turn,and then the selected 11 provinces and cities in the Yangtze River Economic Belt are divided into three regions: central,east and west for current situation analysis.After that,this research uses financial development efficiency as an indicator of financial development,constructs a PVAR model by selecting panel data of 11 provinces and cities in the Yangtze River Economic Belt from 2000 to 2019,conducts an empirical study on the relationship between financial development and residents’ income level,and finally puts forward relevant policy recommendations based on the empirical results.Through the analysis of the impulse response results,it is found that there is a certain correlation between financial development and residents’ income level,and the correlation has a certain term structure and asymmetry: that is,the increase of residents’ income level plays a certain role in promoting financial development in the short term,and the financial development promotes the increase of residents’ income level in the long term.However,the promotion effect of financial development on residents’ income level is greater than the promotion effect of residents’ income level on financial development.Based on the empirical results,this paper proposes the following policy recommendations: further promote financial deepening reform to help raise people’s income level,expand the scope of financial services,develop green finance and optimize the structure of financial services,and vigorously develop inclusive finance and improve the efficiency of financial services.