Research On The Influence Of Financial Development On Economic Growth

Finance is one of the core elements to promote modern economic growth.The continuous improvement of the level of financial development and the optimization and upgrading of the financial system can provide strong support for economic growth and development.However,excessive financial prosperity may have a negative impact on economic development.Therefore,it is of great significance to study the current situation of financial and economic development of various provinces in China and clarify the influence mechanism of the former on the latter.First of all,the article briefly describes the related concepts and definitions of financial development and economic growth,and summarizes the previous research results.Secondly,it analyzes the economic and financial development of the whole region,eastern,central and western regions of China,and briefly describes the interactive relationship between finance and economy in recent years.Finally,set the relevant indicators of financial development and economic growth,based on China’s 2010-2020 panel data with the help of panel model and spatial econometric model,a specific analysis of the impact of China’s financial development on economic growth.The main conclusions are as follows: first,the analysis of basic data shows that China’s total economic output has increased steadily in recent years,but the overall development pattern is "high in the east and low in the west".At the same time,the financial system has also developed rapidly,and the financial volume has expanded rapidly;second,the empirical analysis results of panel data show that at the regional level,the indicators of financial development significantly promote economic growth.When further analyzing according to the regional division,it is found that there is regional heterogeneity in the impact of financial development on the economy.In the eastern region,there is a significant positive relationship between financial scale,financial structure,financial efficiency and economic growth.In the central region,financial scale and financial structure significantly promote regional economic growth,but the relationship between financial efficiency and regional economic growth is not significant.In the western region,the relationship between financial scale and economic growth is not significant,while the relationship between financial structure,financial efficiency and economic growth is significantly positive.Third,the global Moran index analysis of regional economic growth shows that China’s economic growth has obvious spatial dependence,and the regional distribution characteristics of "high-high" aggregation and "low-low" aggregation are significant.The results of spatial econometric regression show that the financial development of each region has significantly promoted the development of regional economy,which is consistent with the previous basic analysis and basic regression results,which shows that the conclusion of this paper is robust.At the same time,the results of spatial econometric regression also show that China’s regional economic growth has a positive external effect,that is,when a regional economic growth,it plays a role in promoting the economic growth of the surrounding areas.Finally,combined with the conclusion of this paper,the paper puts forward the following countermeasures and suggestions for financial development to better promote economic growth.First,we should guide and promote the tilt of finance and all kinds of resources to the central and western regions;second,strengthen the construction of financial market system and micro-mechanism;third,improve the level of financial development and promote the formation of inter-regional point-to-point effects;fourth,we should form a joint force for all-round development to help financial development and promote economic development.