On The Function, Organization, And Behavior Of Local Government------An Economic Approach

This paper is composed of eight parts. In the introduction, it raises the issues, gives the basic concepts, structures the analytical procedures, and shows the research approaches. Then it devotes great efforts to a historical and argumentative discussion about the local government in market economy and its function, and finally it comes to the conclusion that, limited in function, local government is an internal variable of economic growth. China's economy does not develop through a natural entry into market economy, or through the natural transition from primitive market economy to modern market economy, nor does it develop through recovering the market economy and then prescribing local government's behaviors based on it. In fact, China's economy develops mainly through the creative entry into market economy under the governmental leadership.Economic and administrative division of power fundamentally changes the status and interest orientation of local government. Central government and local government renew their relationship, and they comes to be interdependent to each other. Local government is not a vertically dependent administrative organization any longer, but instead, an economic interest subject that has relatively independent economic interest and behavior target. In the "research on local government's behavior target and scale", this paper, in the light of division of power, studies the rationality for which local government exists, elements thataffect local government's scale, and the standard that can reasonably evaluate the scale. In the "research on local government system", it mainly analyzes several typical local administrative systems such as the system of city managing county. In the "research on local government and public products", it emphasizes the validity and laws of local government's supply of local public products. And in the "research on local government and externality", it studies the two forms that cause the externality, and discusses corresponding measures to solve them. Local government was taken as the object of research, but it is taken as the observing subject in nontraditional development research. Rational local government adjustment makes a good opportunity for territorial economy to develop, and the standardization of government behavior makes a key factor contributing to territorial economy development. Local government is part of interest community, and a representative of local public interest; interest community is not the aggregation of individual interest, but the result of interaction between individual and social interest, while local public interest is manifested by local public goods, maintained by local public organization and implemented by local public authority.