Study on financial development based on dynamic panel data model

Abstract

We should take different regional economic and financial development consideration, when we analyze the effect of China's financial development to promote economic growth. This paper analyzes the dynamic panel data model, and concludes that the financial development has the vital simulation effect on economic growth, and the effect is obvious area differences: financial development promotes economic growth strong region in the east than in the central and western regions. Financial development, increase savings and investment, improve the investment efficiency, so as to effectively promote the economic growth. © 2013 Springer-Verlag.