Abstract:Based on OLG theory with production and the dynamic panel data of Chinese 31 provinces, autonomous regions and municipalities directly under the Central Government from 2001 to 2016, this paper investigates the relationships between financial development and economic growth from holistic and regional perspectives by using differential GMM and LSDVC respectively. The empirical results show that: (1) there is a significant non linear and lagged effect between financial development and economic growth, namely lagged and inverted U shape relationship, which means that moderate financial development can promote economic growth. (2) there is no significant relationship between financial development and economic growth in the northeast and southwest areas, which means that financial development has no substantial effect on economic growth in these areas, and the problem of “capital empty operation” is more likely to arise.