Financial development, FDI and economic growth: Evidences from Chinese provincial panel data

This paper use 29 provincial regions (excluding Tibet and Chongqing) panel data, analyses through the financial development make load to the non-state sector and foreign investment sector, reducing the efficiency of the banking sector taking impact on economic growth found that: First, to increase non-state credit scale to promote economic growth in our country. But increase the size of credit scale in FDI sector had no significant effect to the central and western regions´ economic growth; Second, the increase of the foreign investment sector credit scale to reduce the credit expansion negative impact to economic growth in the whole country and the eastern and western. But also the increase to non-state sector credit scale to reduce the positive effect on economic growth, this phenomenon in the central region was not significant. In this point of view, FDI has a crowding-out effect to the domestic non-state sector in the credit markets.