Research On The Transfer Payment System For Equalization Of Regional Economic

After 30 years of reform and opening-up, China's economy grows rapidly with the average rate of more than 8% per year. The level of national economic development increase rapidly, and social wealth accumulated rapidly. But at the same time, china's regional inequality increases rapidly, and it has been a vital obstacle to economic and social development of china. The gauge theory of public economics and regional economics consider that, it is market failure to reduce regional inequality. And it has to rely on government intervention to solve this problem. Financial transfer payment system is one of the important methods of government to reduce regional inequality. It could bring about coordinated development of regional economy with the method of rectifying the imbalance in intergovernmental fiscal capacity and ensuring equal access to basic public services. What role transfer payment play in reducing regional economic disparity? What are the factors in the design of transfer payment system is not conducive to coordinated regional development? For this, the thesis will carry out system analysis these issues from theory and positivism。This paper is divided into five parts:In part one, the thesis introduces the background and significance of the research. the definition of the relevant concept, related literature review, thesis structure, research methods, innovations and shortcomings.In part two, the thesis analyses how does transfer payment promotes the economic growth from theory and model. Firstly the thesis analyses the influence of transfer payment on economic growth form the uses of funds. Then build a growth model containing two-level government, which take the central government transfer payment to local governments into account. It proves out that appropriate scale of transfer payment could promote economic growth. On this basis, we get the conclusion that the central government increase the scale of transfer payment to backward areas could promote their economic growth, so that it could bring about coordinated development of regional economy.In part three, the thesis analyses the regional economic disparity in china positively On this basis, the thesis inspect the effect of transfer payment in reducing the financial disparity between inter-province, inter-region and inter-region and intra-region in china through the establishment of a equalization coefficient. The thesis deems that transfer payment plays some role in reducing regional financial disparity, but he role is limit. As the structure of transfer payment is irrational and some other reasons, the pattern of serious regional disparity is not broke.In part four, the thesis analyses the transfer payment system of the United States, Germany, Japan, and found that the transfer payment system of these developed countries have something in common, Such as it has a clear policy goals; it is based on a clear division of powers and property rights between the government; it has a sound legal protection; adopt factor method, using the standard formula for the allocation of funds. These experiences provide a useful inspiration to improve the transfer payment system in China.In part five, the thesis gives a series of policy recommendations to improve our transfer payment system and bring about coordinated development of regional economy. The recommendations focus on the following aspects:explicit the goal of transfer payments; explore the combination of vertical and horizontal form of transfer payments; divide the powers and property rights between the government clearly; adjust the structure of transfer payments, increase the proportion of equalization transfers; improve the allocation of funds transfer payment; speed up the legal and democratic development of transfer payments, and so on.The thesis has two innovation:first, the thesis discusses the relationship between transfer payments and economic growth, analyses in detail that transfer payment could promotes economic growth by improving fiscal expenditure, so that it could bring about coordinated development of regional economy; second, the thesis comprehensive empirically inspect the effect of transfer payments in reducing the financial disparity between inter-province, inter-region and inter-region and intra-region in china through the establishment of a equalization coefficient.