Abstract: Based on the panel data of China's four economic regions from 2006 to 2015, this paper empirically analyzes the impact of promotion of regional financialization on industrial structure upgrading by using instrumental variable method and whether the impacts are significantly different under different degrees of government intervention in the financial sector. And the following conclusions are achieved:(1)the rising of level of regional financialization has a significant role in promoting the industrial structure upgrading, and the less developed region has a larger contribution margin than the developed region. (2)the intervention of local government in the financial sectors leads to the distortion of financial function and market allocation mechanism, which will weaken the promotion of industrial structure upgrading. The greater pressure on fiscal revenue and expenditure, the more serious the weakening effect. Therefore, to establish a benign circulation mechanism of financialization and industrial structure upgrading, the core is to accelerate the reform of regional financial marketization, putting the fiscal system reform into the same analysis framework to realize the coordinated and orderly development with regional financial evolution.

Key words: regional financialization, governmental behavior, industrial structure, TSLS, SYS-GMM