Empirical Analysis And General Revelation Of Wagner's Law In The Perspective Of New Public Management

Over the past century, in respect of the empirical description of the positive correlation between fiscal expenditure and industrialized economic development, Wagner's Law has profound influence in the field of fiscal theories. Although some scholars have doubts about the Wagner's Law, they never shake the position of the Wagner's Law, and it still the most important theoretical basis for explaining the growth of fiscal scale.The New Public Management Movement initiated in 1970s'has profound influence on the behaviors of the government of the countries all over the world continuously. Due to the huge pressure of fiscal crisis and the model role of the managerial efficiency of private sectors, the New Public Management Movement advocates the large-scale reduction of governmental functions in social field, supplemented by market mechanism functions.The close relationship between the public finance and governmental behaviors and the adjustment of the range of governmental functions require that the fiscal scale and structure must make corresponding adjustment, while the influence of the optimization of the governmental functions in the practice of the New Public Management Movement on fiscal scale is specifically oriented, which can find expression mainly in the following aspects:(1) the restriction of the reduction of governmental functions on fiscal scale; (2) the restriction of decentralization reform on fiscal scale; (3) the restriction of reform of personnel system on fiscal scale; (4) the restriction of supply mechanism reform of public products on fiscal scale; (5) the restriction of reform of social security system on fiscal scale. This paper aims to make theoretical analysis of the influence of the New Public Management Movement on the Wagner's Law in respect of the above five aspects, and disclose a new fiscal phenomenon thereof at the theoretical level:the New Public Management Movement issues unprecedented challenge to the Wagner's Law both theoretically and practically, and even make vital impact on the rationality on the Wagner's Law.To prove the objectiveness of the fiscal phenomenon, this paper takes the fiscal expenditure data of five countries (Australia, Canada, French, England and America) which are typical in New Public Management Movement as the samples for analysis, to investigate the trends of their fiscal expenditure scale since the New Public Management Movement (1979-2006), and makes ADF Test, Cointegration Test and Granger Causality Test for the fiscal expenditure of the typical countries. The computation processes of the tests are all completed by professional software Eviews6.0. The test results show that the fiscal expenditure of the above countries don't support the Wagner's Law from general indexes to category indexes and item indexes. It is proved in practice that the Wagner's Law almost loses the objective conditions of survival after baptized by the New Public Management Movement. There is a validity period of Wagner's Law in which it plays an effective role in the financial practice.The reform and opening to the outside world of China follows the tides of international development closely all along, and pay attention to absorbing and drawing lessons from the successful experience of the developed countries. In the specific process of reform, such as privatization process, the implementation of service-type governmental concept, reform of government agencies, optimization of personnel management system and reform of administrative examination and approval system, keep highly consistent with the New Public Management Movement that sweep over the world. It can be said that the administration reform in China is the organic component of the global New Public Management Movement. Under such concrete background, through the comparison between the fiscal expenditure conditions of China and those of the countries that are typical in the New Public Management Movement, it is found that the fiscal expenditure of China shows rigid upward trends in scale, and both the general fiscal expenditure and most item expenditures of China support the Wagner's Law, and the fiscal expenditure of China still follow the internal logic of the Wagner's Law to a large extent.The reforms and practices of China are oriented to the New Public Management Movement, while the fiscal expenditure of China has the characteristics of the Wagner's Law, which is a kind of deep logic contradiction. With respect to such contradiction that occurs at the same country in the same period, the analysis gives targeted solutions:with the help of market mechanism, reduce and even eliminate the fiscal investment in the fields where the market mechanism can achieve effective effect, and control the scale of fiscal expenditure in this way, working out of the nest of the Wagner's Law, so as to prevent and avoid fiscal risks; while cutting off the overall quota for all expenditures of fiscal in the fields of excessive expenditure, we should take the improvement of people's living as our target, and introduce effective diversified mechanism in the field of public articles (services) supply, and increase the fiscal investment in the fields that the government should do something and make some achievements, and further improve the corresponding management and operation system, so as to improve the utilization efficiency of the fiscal funds in people's living and increase the supply level of the public articles and the public services.