The impact of regional financial development on economic growth in Beijing-Tianjin-Hebei region: a spatial econometric analysis

Chao Wang, Xinyi Zhang, Pezhman Ghadimi , Qian Liu, Ming Lim, H. Eugene Stanley

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The Beijing–Tianjin–Hebei (BTH) integration project in China is ambitious which offers great potential with its promotion of sustainable and inclusive development. This study investigates the impact of regional financial development on economic growth in the BTH region, with panel data collected from 2007 to 2016. Two indicators namely, CREDIT (denoted as regional financial development depth) and BRANCH (denoted as regional financial intermediaries accessibility) are used to construct an integrated regional financial development indicator through the spatial econometrics approach. The spatio-temporal distribution characteristics of regional financial development and economic growth are analyzed. Afterward, the global Moran's I and local Getis–Ord Gi* statistics are applied to detect the presence of spatial autocorrelation. Finally, a spatial Durbin model (SDM) is utilized to examine spatial distribution and spatial association. The research findings of this study suggest that the CREDIT has a positive effect on regional economic growth, while the BRANCH has no impact on regional economic growth. Moreover, it is found that the spatial autocorrelation of CREDIT and BRANCH are statistically significant. The CREDIT of the neighboring areas has a negative spatial spillover effect on economic growth of one area, while the BRANCH in the neighboring areas has a positive effect on the one area. The results and research findings reported in this article highlight the role of regional financial development in improving the economic growth not only for Chinese policy makers but also for other countries’ researchers and practitioners in this field.

Original languageEnglish
Pages (from-to)635-648
Number of pages14
JournalPhysica A: Statistical Mechanics and its Applications
Early online date29 Jan 2019
Publication statusPublished - 1 May 2019


Bibliographical note

NOTICE: this is the author’s version of a work that was accepted for publication in Physica A: Statistical Mechanics and its Applications. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Physica A: Statistical Mechanics and its Applications, [521], (2019) DOI: 10.1016/j.physa.2019.01.103

© 2019, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International


  • Economic growth
  • Financial development
  • Spatial econometrics
  • The BHT region

ASJC Scopus subject areas

  • Statistics and Probability
  • Condensed Matter Physics

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