Research On The Effects Of Fiscal Expenditure On Reducing Regional Economic Difference

The long-term goal to a country and a region is sustainable economic growth and balanced regional development. With the emergence of new theory of economic growth, the effects of government expenditure on economy has become the focus of economic research. And the convergence hypothesis based on the new classical theory of economic growth gives the powerful explanation to the difference of regional economy, the convergence and its reason, and the convergence speed.With the rapid economic growth in China, the difference of regional economy tends to expend. Many scholars research on the reason and solvent of regional difference in China, and the conclusions are widely divergent. Fiscal expenditure policy definitely has immeasurable effects on regional economy of China as a developing country with special historical background. It deserves to explore that what effects financial expenditure policy which carry out macro-control measures have on regional economic growth and its convergence, and whether region equity and optimized resource allocation can be achieved.This paper tries to use new economic growth theory to empirically analyze the effects of the scale and structure of local fiscal expenditure on economy and test the impact of fiscal expenditure and relevant variables on the convergence of regional economic growth. The conclusion is that it is positive correlation between local fiscal expenditure scale and economic growth and the optimized scale of fiscal expenditure is 15.3%. The government can improve fiscal expenditure structure to accelerate economic growth through fiscal expenditure policy, and affect economic convergence to reduce the regional difference.