Does the Establishment of Pilot Free Trade Zones Improve the Efficiency of Financial Services for the Real Economy?Empirical Evidence from Four Pilot Free Trade Zones in Shanghai,Tianjin,Guangdong,and Fujian

In the process of the high-quality transformation and development of China's economy,one of the issues that needs to be resolved is how to strengthen the ability of finance to serve the real economy and improve the efficiency of financial operations.Pilot Free Trade Zones(PFTZs),highlands of institutional innovation,have played the role of a natural testing ground for China to deepen its financial supply-side reform and improve the efficiency of financial services in the real economy.On that premise,this paper discusses the policy effects and transmission channels for the financial reform of PFTZs to improve the efficiency of financial services in the real economy within China.The findings of the papar are the followings,(1)The reform of PFTZsshas significantly improved the efficiency offinance in the real economy,having even achieved a sustainable effect.That is to say,with the extension of gment This work wasthe duration of free trade zone constructionand the gradual implementation of financialreform measures,the regional impactof financial services in the real economyhas shown a year-on-year upward trend.(2)The effects of financial agglomeration,financial transparency,and optimizationof financial infrastructure produced by thereform of PFTZs have played a significantregulatory role in the process of improvingthe efficiency of financial services in thefree trade zones.(3)The effect of China'sfinancial reform on PFTZs has fosterednoticeable regional diversity;an importantreason for the diversity of policy effectrests with the difference in transmissionmechanisms.The conclusions of this paper expand the research dimension of theliterature evaluating the effect of policy onPFTZs,and provide policy references fromthe perspective of financial reform in thefree trade zones for China to further deepenfinancial supply-side reform and improvethe efficiency of financial services in the realeconomy.

Reform and evolution of finance in China:evidence from China’s reform and opening-up in the past 40 years

Over the past 40 years since the launch of reform and openingup,China’s finance has undergone substantial and fundamental changes in terms of size,structure and pattern as well as function,competitiveness,and international influence.Therefore,an accurate and comprehensive understanding of the current situation of China’s finance and its history in the last four decades is a prerequisite for deepening the reform and opening-up of finance and a foundation for establishing a modern financial system in China.This paper reviews the historical evolution of China’s finance over the past 40 years,focussing on the volume and market share of different types of financial assets,financing tools and mechanisms,patterns in and functions of finance,the risk structure in the financial system,financial opening,and the financial regulation model.It further proposes that in the future,China should establish a modern financial system characterised by‘large-economy finance’.