The Brit reached the showpiece without dropping a set and continued that run with a 7-6 6-1 win over his Spanish opponent at the Qizhong Stadium.
Murray struggled to find his rhythm in the opening set, becoming visibly frustrated with his performance but eventually took the lead in a tie-break before blowing Bautista Agut away in the second.
The victory marks his third Shanghai title and his sixth tournament win of 2016, having also won last week's China Open.
Murray also further closes the gap on world number one Novak Djokovic in the rankings but rather than concentrating on top spot, he says he is only thinking about continuing his improvement for now as he believes the Serb still has the edge.
"In the last few months, I have won a lot of matches and made improvements," Murray told Sky Sports. "I have been moving forward better and changed the direction of the ball better. I have also come up with some bigger serves when I have needed them.
"My goal wasn't to finish number one at the end of this year but in the early parts of next year there is an opportunity - 900 points doesn't seem like loads.
"But Novak will win matches. He is the best player in the world. I don't think he has lost an indoor game in a long time."