Research On Identification And Influencing Factors Of Central And Local Fiscal Risk

The report of the 19th National Congress of the Communist Party of China stated that in the process of decisive victory to build a well-off society in an all-round way,we must resolutely fight three tough battles,that is,to prevent and resolve major risks,to accurately eliminate poverty,and to prevent pollution.Among them,preventing and resolving major risks is put in the first place.On the other hand,the report of the 19th National Congress of the People's Republic of China emphasizes people-centeredness at a new level,and puts forward the strategy of rejuvenating the country through science and education,the strategy of strengthening the country with talents,innovation-driven development strategy,rural revitalization strategy,regional coordinated development strategy,sustainable development strategy,military-civilian integration Development strategies and a series of new era socialist development strategies with Chinese characteristics.The smooth implementation of these strategies depends on financial stability,and puts forward new and higher requirements for fiscal risk prevention and control from another perspective.In addition to the policy design of national fiscal risk prevention and control,at the fifth national financial work conference held in July 2017,General Secretary Xi Jinping also made important instructions:"Local party committees and governments at all levels should establish a correct view of political performance "Controlling the increase of local government debt,accountability for life,and checking responsibility" demonstrates the firm determination of the central government to strictly control the risk of local government debt.In December 2018,the National Financial Work Conference clarified the top ten tasks,and "ensure the sustainability of local finance" was also listed as one of the key tasks.These references mean that local fiscal risks have the same important position as central fiscal risks,and they need to be focused on for some time to come.The epidemic in early 2020 posed a great challenge to finances,and became a fuse for the public to re-examine financial pressure and financial risks.For a time,the major news media and academic circles began to think about the risks and sustainability issues caused by financial constraints.In fact,prior to this,fiscal risks and fiscal sustainability have received extensive attention from academia.Classical literature points out that fiscal risk is a possibility that the public resources owned by the government are insufficient to fulfill its expenditure responsibilities and obligations,so that economic and social stability and development are damaged(Liu Shangxi,2003);fiscal sustainability Development is an important criterion for measuring the quality of government finances.For fiscal risks,most studies focus on the measurement and prevention and control of fiscal risks at the national level,and less attention is paid to local fiscal risks.Looking back on China's reality,since the party's 18th National Congress,with the expansion of fiscal expenditure responsibilities and scope year by year,fiscal risks have become increasingly apparent.The state has been implementing active fiscal policies supporting major measures such as structural adjustment,stable growth,promoting reforms,and benefiting people's livelihood for many years in a row,coupled with the economic slowdown and structural tax cuts,the government's fiscal revenue growth rate has continued to fall,and fiscal expenditures have continued to grow rigidly.The reality,and the increasingly severe local debt and hidden debt pressure,the sustainable development of finance has begun to face huge challenges,which will have a certain adverse impact on the role of finance in the foundation and important pillar of national governance.It is difficult to provide corresponding financial security for the future high-quality development of China's economy.It can be found that,whether at the theoretical level or at the practical level,fiscal risks and fiscal sustainability are key areas that China should pay attention to today.Based on the above realistic and theoretical background,this article is based on the perspective of national governance modernization,and at the same time pays attention to and analyzes the central and local financial risks,and logically mines the connection between the two.The necessity is that the new tasks in the new era have given a higher mission to finance,requiring us to base ourselves on the modernization of the national governance system and governance capabilities and pay attention to the status and trends of fiscal risks from a global perspective.Considering from the perspective of national governance,central and local fiscal risks have a logical relationship of mutual penetration and mutual influence.In theoretical research,we need to pay attention not only to central level fiscal risks and sustainability,but also to local level fiscal risks and risks.Sustainability provides basic support for China's economic stability,health and sustainable development.The active prevention and control of central and local fiscal risks is the current slowdown in fiscal revenue growth,the greater rigidity of fiscal expenditures,and the more severe international and domestic environmental situation.The objective needs of the Chinese dream of the great rejuvenation of the Chinese nation.In this context,the study of China's fiscal risk issues has great practical significance,and can make innovative contributions to the theoretical research in this field through the dual perspective analysis of "central-local fiscal risk".The core framework and theoretical logic of this paper is based on the facts of the central and local fiscal risks and the theoretical analysis of the central and local fiscal risk transmission mechanism,to predict and evaluate the central fiscal risks and sustainability,and explore through empirical analysis The influencing factors of central and local fiscal risks finally come up with a feasible way to prevent and control fiscal risks and maintain fiscal sustainable development.Among them,the soft budget constraint and the central government's pocket are the internal incentives for the accumulation and transmission of financial risks in the central region.From the perspective of the central government,local governments that are in financial difficulties have the expectation that they will bear the ultimate responsibility for the central finance,which is also the concentrated expression of soft budget constraints.From the perspective of the local government,the local government has a strong rescue expectation for the central government,which will directly lead to the moral hazard of local government officials and encourage local officials 'short-sighted behavior,thereby further increasing local financial risks and forming a transmission of local financial risks.Vicious circle to the center.The above logic constitutes the core theory of linking the central region's financial risks.Specifically,the arrangement of this article is as follows:Chapter 1 is an introduction,which mainly introduces the background and significance of the topic selected in this article,as well as the research methods and basic framework,and explains the innovation and shortcomings of the article.Chapter 2 is a literature review,mainly including the definition of fiscal risk connotation,measurement indicators,influencing factors,local fiscal pressure,local fiscal risks and their influencing factors.By sorting out the existing literature,this paper finds that there are certain vacancies in the existing theoretical research,mainly reflected in the lack of analysis perspective of the mutual transmission of central fiscal risks and local fiscal risks,and few studies that predict the future financial sustainability.Chapter 3 introduces the characteristic facts and formation logic of central and local fiscal risks.First,construct financial risk evaluation indicators:the central financial risk indicators are divided into a narrow perspective and a broad perspective of the financial risk measurement indicator system;the local financial risk measurement indicator system consists of four first-level indicators and eleven second-level indicators.The next article uses a statistical analysis method,based on the financial risk evaluation index system,using China's actual economic data to objectively describe and evaluate the characteristics of China's macroeconomic operations and central region's financial risks.The article found that although the central and local fiscal risks have been initially reflected,the overall fiscal risks are still under control.At the same time,the third chapter also introduces the transmission logic of central region's financial risks,which lays a theoretical foundation for the empirical research below.Chapter 4 is an introduction to international experience of sustainable financial development.In the field of central fiscal risks,the sustainable development experiences of the United States,the European Union,and the BRICS countries are summarized.In the field of sustainable development,the relevant experiences of the United States,the European Union and the BRICS countries are summarized.In the area of local fiscal risk,it mainly introduces the experience of other countries in the sustainable development of debt.In the course of the research,this chapter uses a comparative analysis method.By reviewing and analyzing the practices of major countries in maintaining fiscal sustainability and responding to financial crises,and combining the differences between the economic and social environment faced by our country and foreign countries,we summarize the available The experience and lessons learned by China.Chapter 5 is the judgment and analysis of the central financial risk.On the basis of summarizing the experience of major countries in maintaining fiscal sustainable development,it expounds its important inspiration for China to avoid fiscal risks and maintain fiscal sustainable development.Subsequently,based on the data of the European debt crisis,the empirical analysis of the central government's financial risks was conducted in terms of basic economic development,government fiscal revenue and expenditure capacity,foreign trade openness,fiscal deficit and debt ratio.Finally,economic forecasting and scenario simulation methods are used to discriminate and analyze the central fiscal risks,reasonably predict the causal effects of different policies on the financial operation,and provide a basis for the introduction of relevant policies.Chapter 6 is the identification and analysis of the influencing factors of local fiscal risks.First introduced the formation mechanism of local fiscal risk,and then analyzed the influencing factors of the three indicators of local fiscal revenue and expenditure risk,local government debt risk and land fiscal risk.On this basis,the samples were grouped according to the level of economic development and region,and a heterogeneity test was conducted.Through empirical analysis,this chapter finds that the economic investment impulse of local governments will cause greater local financial risks,and stronger economic strength will alleviate the local financial risk crisis to a certain extent.For cities of different economic development levels and regions,the influencing factors of fiscal revenue and expenditure gap,deficit dependency ratio,debt ratio and land transfer ratio are not completely the same,and there are large heterogeneities.Chapter 7 draws on the previous conclusions and draws policy recommendations for sustainable financial development in China.It mainly includes:strengthening the coordination of fiscal funds,strengthening local fiscal budget constraints,improving the medium-and long-term fiscal planning and management mechanism,strictly controlling the risk of local government debt,adjusting the economic structure and industrial structure,and reducing tax and fee reduction policies.The innovations of this article are mainly reflected in the following aspects:First,the fiscal risk judgment indicators are formulated from a narrow sense and a broad perspective,of which the narrow perspective mainly studies from the perspective of government revenue and expenditure status and debt risk,and the broad perspective comprehensively judges a country Or regional financial risk situation.Second,from a theoretical perspective,the central and local fiscal risk transmission mechanisms are described.Starting from the soft budget constraint of local finance,the local competition caused by fiscal decentralization,the soft budget constraint of the central government on local governments,the responsibility of the central government for local financial risks,and the transfer of local financial risks to the central financial risks And other theoretical explanations to clarify the transmission logic and feedback mechanism of local fiscal risks and central fiscal risks.Third,based on the data of the European debt crisis,we study the economic fundamentals at the national level,the government's fiscal revenue and expenditure capabilities,the degree of economic openness,fiscal deficits and the effects of government debt on fiscal risks.At the same time,it also uses regional data and micro-mechanism methods to conduct an empirical analysis of the influencing factors of local fiscal risks.Fourth,it uses economic index prediction methods to predict China's economic and fiscal trends and fiscal sustainability.The shortcomings of this article are mainly reflected in the following aspects:First,the financial risk indicator system constructed in this article is probably not comprehensive enough.In the future,the central region's financial risk indicator system needs to be further improved according to China's national conditions.Second,whether the financial risk indicator system established in this article is applicable to all regions of China or foreign regions,more empirical data needs to be tested.Third,in the follow-up research,we can further study the relationship between local fiscal risks and central fiscal risks in combination with the actual situation of China's fiscal system reform to form effective theoretical support,policy tools,and institutional systems.