The Dynamic Interaction between the Financial Development and the Urbanization Process in China --Based on the Analysis of Panel VEC Model

摘要

Based on the panel VEC model, this paper verifies the dynamic interaction between China's financial development and urbanization process and analyzes the short-term, medium and long term situation.The results of this research show that: the financial development can promote the urbanization process in short term, but there is not enough evidence to suggest that the urbanization process plays a significant positive or negative role in promoting China's financial development.However, in the medium and long term, there exists interaction between financial development and urbanization as both cause and effect.Based on the above, we analyze the reasons and propose the corresponding policy suggestions.