Empirical Research On The Influence Of Fiscal Expenditure Structure On Economic Growth In Lanzhou

Along with the establishment and development of market economy in China, the government function changes and the fiscal expenditure structure should be adjusted and optimized too. Its premise is studying on the influence of different components on economic growth both in direction and degree. Studying on influence of fiscal expenditure structure on economic growth in Lanzhou has active significance to local fiscal expenditure structure optimization, efficiency of fiscal operation improvement and western region economic growth.Based on domestic and foreign relevant studies and experience, this paper analyzes the present condition of fiscal expenditure structure in Lanzhou according to the statistics from 1978 to 2006, then it analyzes the short-term elasticity and long-term relationship between variables by using VEC model and variance composition. The empiric analysis indicates that different expenditure has different impact on economic growth both in direction and degree. Among all the factors, expenditure for capital construction has positive long-run effect over economic growth while expenditure for supporting agricultural production,expenditure for government administration and operating expenses for culture&health care have negative long-run effect over economic growth. Operating expenses for culture&Health care has notable hysteresis. Based on above analysis, we should adjust the fiscal expenditure structure by reducing expenditure for capital construction, increasing operating expenses for culture& health care further, and optimizing their proportion.