Research On The Choice And Optimization Of Local Government Debt Scale Based On The Perspective Of Sustaining Economic Growth And Controlling Risk

With the sluggish global economic growth and increasing international trade frictions,China is facing severe economic growth pressures.If the local government continues to promote economic growth by local government debt,the scale of local debt will rapidly expand in the short term,accumulating the debt default risk and affecting the healthy and stable development of the economy.In these dilemmas,the selection of local debt scale has become a hot spot for the government and scholars.The Central Economic Work Conference took sustaining growth and controlling risk as important tasks for the current economic work.On the one hand,local government debt can promote economic growth through improving infrastructure,but it also can trigger a debt crisis due to its large scale.It can be seen that the key to the rational use of local debt is to properly handle the relationship between economic growth and debt risk.If we only focus on the risk of local debt and ignore its economic growth effect,we will not be able to achieve the goals of controlling risk and promoting growth.In this context,the fusion of the local debt economic growth effect and debt risk,and the selection of the local government debt scale,which have become hot topics for scholars at home and abroad.Under the background of sustaining growth and controlling risks,researching on the economic growth effect and local government debt risk,clarifying its internal mechanism,and under the controllable conditions of local government debt risk,scientifically selecting the scale of local debt and optimizing the allocation of local government debt,which are great theoretical value and practical significance for improving economic growth and reducing local debt risks.In the existing research on local debt,scholars often choose the optimal scale of local government debt from economic growth or local government debt risk perspective without considering economic growth and debt risk at the same time,which may make the selected debt scale subjecting to large deviation,while failing to achieve the goals of sustaining growth and controlling risk.In addition,the econometric models used in empirical researches on local debt often ignore the spatial effects that commonly are found in local debt and regional economies,which may make the empirical results subjecting to large deviation.How to consider the spatial correlation and spillover effect of local government debt in different regions,and then build a spatial econometric model to describe the spatial correlation structure,and base on the current local debt management goals,integrate economic growth effect of local debt and debt risk factors to establish local debt scale selection model is the core issue in the current research of local debt scale selection.Local debt can promote economic growth at a moderate scale,and excessive scale will trigger a debt risk crisis.As a complex system,local debt interacts with the debt growth and debt risks.Therefore,the consideration of economic growth and debt risks in the selection of local debt scales,then get the difference in the use efficiency of local debt,which fits the essential feature of local government debt operation.This thesis bases on the theory of local debt economic growth and risk management.The DEA(Data Envelopment Analysis)method in the efficiency assessment theory and the Bootstrap statistical method are used to improve measuring accuracy of the traditional model,build a Bootstrap-three-stage DEA model,which is used to measure the use efficiency of local debt,and get the difference in the use efficiency of local debt,which is be caused by the difference in local debt economic growth capacity in different regions.Based on the non-linear relationship between the local debt scale and economic growth,a spatial econometric method is applied to describe the non-linear relationship.Using the constructed semi-parametric spatial model to mine the critical value of local debt scale.Then based on the obtained critical values,this thesis builds a series of local debt theories and spatial econometric models to analyze the cross-regional spillover effects of local debt risk and the economic growth of local debt to resolve the debt risk.Combine the economic growth of local debt and debt risk factors to select the local debt scale.Construct the DSGE model to select local debt scale to promote economic growth,analyze the risk mechanism and path of local debt,and dig the optimal scale of local debt,optimize the allocation of local debt scale to amplify economic growth effects.In general,the main content of this thesis includes the following three aspects:(1)Utilize the advantages of statistical methods such as spatial econometric and semi-parameter,introduce regional economic and geographic distance information to construct a spatial matrix to improve the non-linear model of local debt economic growth effect.Then,build Bootstrap-three-stage DEA Model and semi-parametric spatial econometric model.Based on above models,under the task of sustaining growth,Chinese local government debt use efficiency and nonlinear economic growth effects are researched.The results show that the improved DEA model and semi-parametric spatial econometric model can more effectively measure local debt efficiency and the nonlinear relationship to a certain extent.Furthermore,it shows that the spatial econometric model and semi-parametric method have a certain practical significance in the selection of the local debt threshold scale,which can better capture the relationship between local debt scale and economic growth to a certain extent,and improve the accuracy of the threshold value selection.(2)Improve the KMV model of debt risk by decomposing solvency and improving the solvency prediction method to increase the accuracy of local debt risk measurement,and introduce the effect of local debt economic growth into the research of local debt risk to test the ability of economic growth to resolve debt risks and the effectiveness of local debt risk management.Based on the current local debt operation mode in China,the debt solvency is decomposed from the perspective of flow and stock of solvency.Introduce the GM(1,1)forecasting model to improve the KMV model of local debt risk.Taking Chinese provincial governments as the research object,the default risk of local debt is measured.On this basis,the economic growth is introduced,and the ability of local debt economic growth to resolve debt risk is tested by constructing econometric models such as panel threshold model and panel model.The empirical results show that compared with the traditional risk measurement model,the improved local debt risk measurement model shows higher accuracy.At present,Chinese local government debt risk is still under control,but debt risks of some central and western provinces are relatively serious.Under the moderate scale of local debt,which shows a positive economic growth effect.At this time,local debt can promote economic growth and resolve local debt risks.(3)Local government debt expansion has a significant economic growth effect within a certain scale.When the scale exceeds a certain threshold,local debt risk crises may be induced,providing a reasonable choice of selecting local debt scale to promote economic growth and resolve local debt risk.This thesis uses the theory of local debt economic growth and risk management to establish a DSGE selection model for local government debt scale to effectively analyze the internal operating mechanism of local debt to weigh the local debt economic growth and debt risk to select a reasonable local debt scale.Base on the contract theory and structured model to construct a local debt scale optimization model to promote economic growth and decrease local debt risk by expanding solvency.In the modeling process,this thesis selects the scale of local debt from the perspective of economic growth and debt risk,avoiding the disadvantage of selecting the scale of local debt only from economic growth or debt risk perspective.Theoretical analysis and numerical simulation research results show that local debt can increases local fiscal revenue by promoting economic growth and reduces local debt risk.Compared with the traditional local debt scale selection model,the accuracy and reliability of the local debt scale selection model that is constructed in this thesis has been improved to a certain extent.The local debt scale optimization model is constructed to optimize the allocation of local debt scale with the goal of promoting economic growth or controling debt risk,which can increase the total socio-economic returns and reduces the default probability.