| Public finance is the foundation and important pillar of national governance.The smooth performance of government functions and the smooth operation of national governance are inseparable from the standardized,efficient and sustainable public financing.The financing mode of local government is an important perspective to study how to speed up the establishment of modern fiscal and taxation system,enhance the medium-and-long-term stability and sustainability of public finance,promote the transformation of government functions,and support the modernization of national governance system and governance capacity.Under the background of the current tax sharing system,the traditional financing mode with tax revenue as the core is difficult to provide sufficient fund sources for local governments.Non-tax revenue is growing rapidly,and various financing tools such as land finance and local government debt emerge in an endless stream.Previous studies mainly focus on the influencing factors and economic effects of local governments' single financing decision,but lack in the institutional causes and social effects of local government financing mode deviating from tax revenue to other financing channels.Therefore,based on the typical fact of dynamic adjustment of local government financing mode,this paper systematically reviews and analyzes the evolution process and institutional change of local government financing mode since the founding of new China,explores the internal mechanism of local government financing mode transformation from the aspects of fiscal,financial and political management system,and objectively evaluates the economic and social effects of local government financing mode transformation based on macro and micro perspectives,so as to optimize the local government financing mode.First of all,this paper defines the concept of local government financing and introduces the mode of local government financing,includes fiscal financing,asset financing,debt financing and equity financing.Then,this paper systematically analyzes the transformation process and institutional change of local government financing mode since the founding of new China,which is mainly divided into five stages,including planned economy period(1949-1979),financial contracting period(1980-1993),land financial prosperity period(1994-2007),municipal investment bond blowout period(2008-2014),and debt financing standardizing period(2015 to present).This paper summarizes the evolution law and system guidance of local government financing mode,and analyzes the existing problems of local government financing mode from the aspects of financing scale,structure,standardization and sustainability,so as to lay the foundation for the following analysis of the internal mechanism of local government financing mode transformation and its economic and social effects.Secondly,based on the prefecture-level financial and economic statistics and the information of local government officials from 1999 to 2017,this paper explores the internal mechanism and its regional heterogeneity of local government financing mode transformation from three aspects: the local fiscal pressure caused by the reform of the fiscal and taxation system,the political promotion incentive embedded in the championship of official promotion,and the regional development pressure brought by the performance appraisal of economic and social development.The results show that:Non-tax revenue has the characteristics of “payroll finance”,especially when the management of non-tax revenue is weak or the administrative costs of local government are high,the fiscal pressure significantly increases the ratio of non-tax revenue to tax revenue.Land financing has the dual motivation of “land finance” and “land attracting capital”.On the one hand,local governments are keen on selling commercial and residential land at high prices through bidding,auction and listing to reduce local fiscal pressure;on the other hand,affected by promotion incentive and development pressure,local governments tend to sell industrial land at low price through agreement,so as to attract investment to promote local economic development.Especially in the jurisdictions with lower land transfer cost,the positive impact of fiscal pressure,promotion incentive and development pressure on the ratio of land transfer income to tax revenue is more obvious.Debt financing has the characteristics of “developmentoriented finance”.Before 2008,local governments are forced to borrow,and debt financing was a reluctant action to cope with fiscal pressure;since 2008,local governments began to take the initiative in debt financing,hence promotion incentive and development pressure are the main reasons for the expansion of local public debt.Especially with weak financing constraints caused by implicit financial decentralization,the positive impact of promotion incentive and development pressure on the ratio of local public debt to tax revenue is more obvious.The above conclusion is still robust after using difference-in-differences estimation and regression-discontinuity estimation methods to overcome the endogeneity problem.Thirdly,this paper examines the economic effects of local government financing mode transformation from the macro and micro dimensions.At the macro level,based on the prefecture-level financial and economic statistics from 1999 to 2016,this paper empirically tests the impact of local government financing mode transformation on macroeconomic fluctuations and its mechanism by using generalized method of moments estimation.The results show that: Non-tax revenue,land finance and debt financing will aggravate the regional economic fluctuations,and the impact is sustainable.The heterogeneity analysis shows that the effect of land finance and debt financing on economic fluctuation varies with political turnover.The fluctuation of land transfer price will strengthen the impact of land finance and debt financing on economic fluctuation,and the improvement of financial development level will help to stabilize the impact of land transfer and debt financing on economic fluctuation.Further mechanism analysis shows that non-tax revenue exacerbates economic fluctuation by weakening the function of tax automatic stabilizer,land finance increases economic instability through investment fluctuation and house price fluctuation,and debt financing aggravates economic fluctuation by enlarging investment fluctuation.At the micro level,given that the production efficiency of enterprises is an important indicator to measure the quality of economic development,based on the national tax survey data from 2007 to 2015,this paper uses OP method,LP method and ACF method to estimate the total factor productivity(TFP)of enterprises,and empirically tests the impact of local government financing mode transformation on corporate TFP.Moreover,this paper constructs a moderated mediating model to analyze the transmission mechanism from the perspective of corporate tax burden,production cost,investment and financing behavior.The results show that: Non-tax revenue has a weak positive effect on the improvement of corporate TFP,while land finance and debt financing have a stronger inhibitory effect on the improvement of corporate TFP.The heterogeneity analysis shows that for non-state-owned enterprises and small and medium-sized enterprises,the growth of non-tax revenue has a more obvious promoting effect on their TFP,and the negative impact of land transfer income and local public debt expansion on their TFP is greater.Further mechanism analysis shows that non-tax revenue promotes the increase of corporate TFP mainly through the channel of reducing tax burden,land finance mainly suppresses the growth of corporate TFP by increasing productive building cost,and debt financing hinders the improvement of corporate TFP by increasing tax burden,reducing credit resources and restraining investment in fixed assets.Fourthly,from the macro and micro dimensions,this paper examines the social effects of local government financing mode transformation from the perspective of environmental governance.This paper uses the data of regional industrial pollution emission from 2003 to 2017,and enterprise emission indicators from the national tax survey data during 2013 to 2015 to match the prefecture-level financial and economic statistics to empirically test the impact and its mechanism of local government financing mode transformation on regional environmental pollution and enterprise emissions.The prefecture-level empirical evidence shows that: Non-tax revenue has no significant impact on regional environmental pollution,while land finance and debt financing significantly increase the emissions of industrial wastewater and industrial sulfur dioxide.This conclusion is still robust after controlling endogenous problems with instrumental variable estimation.The heterogeneity analysis shows that in the jurisdictions where the central government's environmental regulation is weaker and the catch-up pressure of economic growth is greater,the positive impact of land transfer and debt financing on regional environmental pollution is more obvious.Further mechanism analysis shows that land finance and debt financing aggravate regional environmental pollution by reducing environmental governance investment,expanding the scale of industrial land transfer and reducing the industrial land transfer price.The firm-level empirical evidence also supports the above conclusion.There is no significant correlation between non-tax revenue and enterprise emission,while land finance and debt financing stimulate enterprises to increase emissions.The heterogeneity analysis shows that in the jurisdictions where the central government's environmental regulation is weaker and the promotion incentive of local officials is stronger,the positive correlation between land transfer and debt financing with enterprise emission is more obvious.In addition,land finance and debt financing have a greater positive impact on the emissions of enterprises in high pollution industries.Further mechanism analysis shows that the expansion of land transfer income and local public debt causes enterprises to increase emissions through strengthening the competition for land investment,which is reflected in the decrease of land use cost and increase of land acquisition.Finally,based on the above research conclusions,this paper puts forward the following policy recommendations: Firstly,adjust the fiscal relationship between central and local governments to reduce local fiscal pressure,improve the performance evaluation mechanism for leading cadres and guide local officials to establish a correct view of political achievements,and vigorously promote the coordinated development of regional economy,so as to break through the system and mechanism obstacle of financing mode optimization.Secondly,improve the tax financing capacity from two aspects of perfecting the local tax system and improving the efficiency of tax collection and management.Thirdly,strengthen the non-tax revenue management,and effectively control local administrative expenditure,so as to reduce the proportion of non-tax revenue in fiscal revenue.Fourthly,reasonably adjust the urban-rural distribution mechanism of land transfer income,and accelerate the land finance transformation by promoting real estate tax reform.Fifthly,establish a standardized mechanism for debt financing by local governments,actively and steadily resolve the stock of hidden debt,and accelerate the market-oriented transformation of local financing platform.Sixthly,broaden the local government financing channels based on the multi-level capital market system,give full play to the guiding role of fiscal funds to mobilize financial and social capital,and build a financing system characterized by “government led,hierarchical responsibility,diversified forms,standardized and efficient financing,controllable risks”. |
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