Research On The Environmental Protection Fiscal Expenditure Effect And Efficiency Of The Local Governments In China

Since the Reform and Opening,the economy of China has developed tremendously.Along with many increasing indexes,China created the China Miracle.During the past 30 years,the growth rate of China's economy had been around 10%,and overtook Japan to be the second largest economy worldwide in 2010.Although the economic growth rate slowed down in recent years,China is still the engine of the world economy under the circumstance of the global depression.However,behind these economic achievements,the environment of China has been threatened.As the high-speed development of industry in China brings the pollution and the erosion to air,rivers and soil,and which make Chinese people's health in danger.Thus,the environment problems have been seen increasingly important by Chinese government.In 2007,the added category of “No.211 Environment Protection” into the Government's Categories of Income and Expenditure published to show the symbol that our country started to possess the expenditure category aiming at protecting the environment.During the time after this category determined for some years,the following issues should be thought thoroughly.For examples,what kinds of adjustments the governmental expenditures achieve,whether the expenditures could control the environmental pollution and how the efficiency of the expenditure using on fixing the environment problems.For answering the mentioned questions,this paper starts researching from the appeared environment problems to determine the background and significance of doing this research,decides to use descriptive statistics method and Data Envelopment Analysis method as the main ways of the research,clarifies the parts of creativity and lack to build the basis for the whole paper.After that,the paper summarizes,concludes and evaluates the Chinese and foreign references about,such as,how to manage environment in effective ways by using relevant policies,the efficiency of governmental expenditure,econometrics model used for governmental expenditure,data envelopment analysis,effect of other governmental spending in environment,environmental efficiency and the policies and rules for fiscal expenditure in environment.First of all,the theoretical analysis of how the fiscal spending can improve the environment protection is discussed.Additionally,combined the basic theories,such as Public Good Theory,Externality Theory and Sustainable Development,the thesis explained the necessity of the public spending of environment protection.At last,the routines of how the governmental expenditure affects the environment are clarified.Additionally,the analysis of the gradual progress of governmental expenditure in environment protection is stated.Firstly,the important issues and Acts of the environment protection are stated.Then,the content and the perfecting process of “No.211 Environment Protection” category during the year 2007-2016 are concluded.Next,the situations of this governmental expenditure are analyzed from the different angles of absolute scale and relative scale,such as the total amount of the environmental fiscal expenditure,the growth rate,the transfer payment,the completion of budget,and the spending structure of environment protection.For analyzing the effect of fiscal spending in environment protection,this research applies Panel Data Model to estimate the data in 2007 to 2014.After determining the six indexes of pollution,it uses the methods,such as,standardization and determining weights,to deal with the original data and to integrate the Environmental Pollution Index,and establishes the Panel Data Regression Model with the relevant indexes including governmental spending,numbers of people employing in environmental protective industry,GDP per person and population density.Then,the effect of how the public spending of environment protection works is found out.Based on the results of the panel data analysis,this research uses Data Envelopment Analysis to calculate the relative efficiency of varies local environmental expenditure also in 2007-2014.In this part,the environmental fiscal expenditure is chosen as the inputs and the accessed environment indexes are the outputs,and the non-redial and variable returns to scale DEA-SBM model and Round Robin Windows Model calculating methods are taken use of measuring and analyzing the efficiency of governmental expenditure in environment protection.Additionally,it also uses adjacent-cross-reference Malmquist Model to measure and analyze the variety of productivity and the technological advance.By integrating with preceding chapters,the six existing problems are shown: inadequate amount of environmental expenditure,instability of increasing rate and fulfilling rate,the inelasticity of environmental expenditure to pollution,inefficiency of public spending in environment protection,significant variety of efficiency,and the retrogression of technological advance during the year 2009-2014.Then,the analysis of the reasons is given.The suggestions toward exiting problems of governmental expenditure on environment protection are also provided focusing on the following issues,such as,establishing stable protecting system for governmental expenditure,keeping increasing the amount of environmental fiscal expenditure,creating a comprehensive account of environmental fiscal expenditure,creating and adjusting the relevant tax for environment protection,clarifying the environment protection duty between the central and the local governments,completing the relevant supervising system for environment protection,optimizing the structure of governmental spending for environment protection,enhancing the “using reward instead of subsidy” and the “using reward to promote governing” policies,improving the comprehensive capability of environmental protecting organizations,and increasing the propaganda and education of environment protection.