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Transfer Payment,Financial Balance And Basic Public Service Equalization

Posted on:2014-02-11Degree:DoctorType:Dissertation
Country:ChinaCandidate:F LiFull Text:PDF
GTID:1229330398459898Subject:Public Finance
Abstract/Summary:PDF Full Text Request
China economy has rapidly developed since the reform and open policy. The GDP which represents the total economic output reached47.21trillion RMB in2011. By the National Bureau of Statistics, it was up to51.93trillion RMB in2012, increasing by more than100times compared to364.5billion in1978. At the same time, the voice that people want to share the fruits of reform and have access to basic public service which offered by the government is higher and higher. We can also see that nowadays the target of fair is not realized and the gap in some aspects is still increasing, which mainly includes the gap between urban and rural areas and regional gaps in basic public service. These gaps are due to natural conditions, historical reasons and system reasons, which urgently need the government play a positive role, undertake the historical responsibility to provide basic public service to achieve the equalization.China is a unitary state. The central government undertakes the dual responsibilities of development and stability. On one hand the government should emphasize the efficiency of economic growth, on the other hand it should also maintain a fair distribution to realize the target of the equality of public service between urban and rural areas, which is a really heavy responsibility on shoulders. According to the division of powers, the realization of these functions specifically depends on local government’s implementation. After the tax-sharing system reform inl994, financial power more and more centralized to the central government. The right scope of local government is wide, but the financial recourses are comparatively insufficient and the differences in different regions are huge, which can’t match their powers. To realize the equalization of public service goals, the financial support from the central government is necessary, so the vertical transfer payment from the central government to the local governments become an important means to increase local government financial resources, balance the difference between regions and embody the central intention. The longitudinal intergovernmental transfer payment system fundamentally results from fiscal decentralization intergovernmental financial imbalance. That financial imbalance leads to regional equalization of basic public service objectives can’t be achieved, so the rational design of the transfer payment system is needed to promote the equalization of basic public service among regions supply. This paper mainly focuses on questions as follows:Whether the central transfer payment to local governments can improve the level of equal access to basic public service? How to improve the system of transfer payment under the guidance of equal access to basic public service? This paper will evaluate the level of equalization of basic public service by comparing the equalization of basic public service of other provinces in China except Tibet with Shandong Province.This paper is divided into seven chapters, the specific content of each chapter is as follows:Chapterl:Introduction. Introduce the background and significance of this study briefly and also the structure and innovation points of the full text.Chapter2:The related literature summary of transfer payment promote the equalization of basic public service. Introduce the connotation, the equalization of basic public service theory, measurement methods and influence factors. Describe the financial balance and financial balance theory and practice. In the equalization of basic public service, emphasize financial equalization’s importance in the ability of public service equalization. Emphasize the prominent important position of financial transfer payment in the realization equalization between the areas and summarize the transfer payment of promoting the equalization of basic public service and introduce the effect of transfer payment from the impact on regional public service equalization.Chapter3:Transfer payment mechanism to promote equalization of public service. Firstly introduce the development process of the system of transfer payment and the main forms of current transfer payment and then focus on the analysis of relationship between transfer payment and the equalization of basic public service system, with the conclusion that the transfer payment system is an important means to achieve the equalization of basic public service and also the main target to achieve the equalization of public service. Secondly introduce the other countries’ successful experience in using the transfer payment to promote the equalization of public service and draw the conclusion from the theory and practice that the rational design of the transfer payment system can promote inter-regional equalization of public service. Whether the design of China’s current central government transfer payment can promote the equalization of public service among the different areas also need empirical test.Chapter4:Analysis of the current situation of the transfer payment and the equalization of basic public service. Firstly conduct an investigation on the implementation of transfer payment system to study the change trend of central transfer payment to local governments and analyze the situation according to the classification of the transfer payment find the existing problems in the amount and structure of the current transfer payment. To estimate the basic public service equalization degree, the paper chooses the provincial level government as the object to establish the index system to measure the level of basic public service. Starting from seven aspects like the social security, public health, education, infrastructure, environmental protection, science and technology and the public culture, established the basic public service measure index system including7first level targets,20second level index. Conclusion shows that China’s basic public service equalization index rose up and down from2000-2011.It showed a unilateral growth a few years ago. In recent years, the fluctuation is comparatively large. The level of regional equalization of basic public services has improved. Although the coefficient of variation reached its highest point after slightly reduced in2007, the increase of equalization of basic public services among regions was not obvious. After declining in2009and rising rapidly in2010and further reducing in2011, it shows that there is a large change in the level of public basic services among regions.Chapter5:An empirical analysis of the transfer payment promoting the equalization of public service. Through the total amount of ordinary panel fixed effect model to test the effect of the total central transfer payment on provincial government public service equalization. The conclusion shows that fiscal transfer payment and tax rebates will have a positive effect on the equalization of basic public services, while the special transfer payment, tax revenue, income, extra budgetary funds, budget expenditure, per capita GDP, price factors as control variables have no significant effects on the equalization of basic public services.Chapter6:The influence of Shandong provincial transfer payment on the public service equalization in the cities. Extend the transfer payment level below the province to test influence the provincial transfer payment to the equalization of public service on17cities. Shandong province is chosen to establish the index system. Considering the availability of data, choose the more simple indicators compared with the provincial index system to get the basic public service equalization index in Shandong Province and use the2007-2009panel data of17cities in Shandong province to examine the influence of the provincial total payment and partial to transfer payments to the equal access to basic public services. The conclusion shows that the effect of per capita GDP of Shandong province on the equalization of basic public services is significant, while the effect of both the transfer payment and partial transfer payment transfer payment is not obvious. The effect of budget income and budget expenditure as the control variables on the equalization of basic public services is not remarkable too.Chapter7:Improve the system of transfer payment. The idea of promoting the equalization of public service elaborated the path of equalization of basic public service among the main governments in our country is to reform the system of transfer payment. This is an important way to solve the problem of financial imbalance between governments and to achieve the goal of promoting the equalization of basic public service, which should advance steadily. Considering the differences between regions, natural conditions, economic development level disparity, the government limited financial reality, the equalization of basic public service implementation is a long-term process. In the part that perfecting the transfer payment to promote the equalization of basic public service, the measures proposed in improving the central government transfer payment system includes:the reasonable division of powers in the scope of government; deepen the reform of financial system, enhance the service function of the government; improve the system of transfer payment; accelerate the pace of construction of legal system, implementation of transfer payment in accordance with the law. The paper also proposed to establish two different transfer payment modes arrange special transfer payment equalization of basic public service for the projects and proposed specific transfer payment design including equalization transfer scheme design, special transfer payment scheme design.Research methods of this paper include:firstly, by using the statistical method, the typical indicators the government had in the areas of basic public service are chosen to build the index system. Use the analytic hierarchy process and principal component analysis to test the level of provincial and municipal equal access to basic public service; secondly, by the use of the common panel fixed effects model, the writer selects a plurality of samples to analyze the whole situation and find that the transfer payment can indeed promote the equalization of basic public service.The main points of this paper include:Firstly, completely discussed the relationship between the national and provincial level of government transfer payment and the local equalization of basic public service and pointed out that the transfer payment is the main mode to achieve the equalization of basic public service among regions. Secondly, discussed the internal mechanism of transfer payment to promote the equalization of public service, pointed out that the transfer payment system in promoting regional financial equalization is very helpful to realize the equalization of public service. Thirdly, Empirical test shows that China’s transfer payment is an important factor to promote the equalization of public service and puts forward some measures to improve the equalization of basic public service among regions of the transfer payment system.The innovation of this thesis lies as the follows:Firstly, the paper constructed the transfer payment comprehensive analysis framework of the equalization of basic public service among regions based on the existing theoretical framework and divided the effect that transfer payment on the equalization of basic public service among regions into direct effect and indirect effect. Secondly, This paper systematically examines the transfer payment effect on the equalization of basic public service among regions, it studied not only the central government to provincial government transfer payment effect on the equalization of basic public service, but also the transfer payment under provincial municipal international influence on the equalization of basic public service. Thirdly, the paper put forward the overall thought to further improve the transfer payment system, according to the effect that different levels of transfer payment have on the corresponding region of equalization of basic public service and on this basis, put forward the concrete design scheme of transfer payment, including design equilibrium transfer payment and special transfer payment.
Keywords/Search Tags:inter-government fiscal transfer payment system, financial balance, basic public service equalization
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