The Research On Appropriate Scale Of Local Government Of Fiscal Investment

The research on local government investment has long been a weak link in our fiscal research work. This fact is faced with many challenges. First is the shock from the worldwide fiscal power decentralization. Second, the strategy adjustment of our economic structure in the 21st century could not be taken automatically by the market, but should elaborate the local government investment function. Last, in order to construct public finance, the scope and structure, especially the scale of government investment need to be adjusted. For the reasons above, the topic of local government investment scale chosen by this paper undoubtedly has important theoretical and practical values.Based on defining the basic concepts, this paper first discussed that the governmental functions in the transitional period can't be simply regarded as "consuming finance" and public finance shall consequentially include some productive factors. The paper also gave its answer "no" to whether or not the local government investment should exit from competitive and for-profit areas. First, the point of that is it can't be ignored that state-owned economy can efficiently execute the industry policy of the government and fulfill the macro economic goals. Second, the local government should not exit simply for its special function in the transitional period.Through the game theory analysis between local and central government, all local governments came to invest the local infrastructure. Exampled as Shann'xi province, the paper discovered that the local governmental finance investment played an important role in the economy growth through quantitative analysis. All of these explained local governments necessarily need to motivate the basic growth problem as the form of investment.However, the investment of local government must be kept within some a level, the excessive investment will lead to the crowding out effect and influence the basic efficiency of the market economy. In the third and fourth chapter this paper discussed appropriate scale of investment, and analyzed the data on developing and changing in local investment by time series analysis. The paper concluded that there was a series ofproblems in the local government investment with too small scale. Based on quantitative analysis about the standard appropriate investment scale, the paper introduced its viewpoint about the amount standard. In order to optimize the investment scale, the government must decide the implementing path. This paper analyzed the industry structure, investment scale structure and investment region structure. Finally strategy and suggestion were proposed for optimizing the local government appropriate structure of investment...