Abstract: By making use of China’s provincial panel data from 1997 to 2008, this paper re-examines the linkages between total factor productivity (TFP) growth and financial development and the intermediate channels with the three samples of national level, coastal regions and inland areas. The result finds that the growth effects of TFP of China’s financial development is related with the regional factors; the intermediate channel through which financial development promotes TFP growth is technological progress rather than technical efficiency growth. It indicates that to boost the reform of China’s financial system so as to promote the financial development is of great importance in improving the quality of economic growth.

Key words: financial development; total factor productivity; regional disparity