Research On The Contagion Path Of Regional Financial Risk In China From The Spatial Perspective

As an intermediary and a bridge connecting capital supply and demand,financial sector can guide resources to flow into the real economy and thus promote high-quality and sustainable development of the economy.However,with the closer connection between the real economy and the financial sector,a regional risk may accumulate gradually or spread along a certain path and even evolve itself into systemic financial risks.At the same time,China’ economy is being in a period of replacing old drivers of growth with new ones,and destabilizing factors at home and abroad are intertwined.Financial risks that have accumulated over the years are prone to frequent occurrence,and most of them are regional financial risks.Therefore,from the perspective of economic sector operation,it is of great significance to study the contagion path of regional financial risks in China for the bottom line of preventing systemic financial risks.Based on the macro data of 31 provinces(municipalities and autonomous regions included)in China from 2011 to 2019,this paper measures the level of provincial financial risks in China and tests the risk contagion paths among economic sectors.Firstly,on the basis of the traditional index,the digital financial index is tentatively included,and the regional financial risk index system is constructed from the two dimensions of regional economy and regional finance.The entropy weight method and improved CRITIC method are used to measure the provincial financial risk index as well as the risk accumulation of the financial sector.Secondly,the regional differences of regional financial risks are studied through Dagum Gini coefficient decomposition method.Finally,the regional financial risk index is taken as the explained variable,and the explanatory variables are selected from the government,enterprises and household sectors to construct the spatial Durbin model and then test the contagion path of China’s regional financial risk through the spatial partial differential method.The empirical results show that:(1)The regional financial risks at the provincial level in China generally show an upward trend of fluctuation,in the northeast,west,central and then east from high to low.(2)Regional differences in China’s financial risks show a further increasing trend,and regional differences are the main source of regional differences in financial risks.(3)Regional financial risk in China has a significant positive spatial correlation effect,and there are risk contagion paths of government-financial sector,enterprise-financial sector,and family-financial sector.Government and enterprise sectors are the main sources of infection,and the infection between regions is greater than that within regions.(4)There are regional differences in the contagion effect of regional financial risks.In eastern China,the contagion effect of enterprise-financial sector is stronger,and in central and western China,the contagion effect of government-financial sector and family-financial sector is stronger.Based on the above research conclusions,this paper puts forward the following countermeasures and suggestions: to strengthen regional financial risk monitoring and early warning;to implement differentiated risk prevention strategies;to create a good regional financial ecological environment.