Research On Investment Efficiency Of Infrastructure In The Context Of Fiscal Decentralization For Liaoning Province

Since 2003, the infrastructure investment in China played an important role on economic growth under the national macro-control. Therefore, local governments have increased investment on infrastructure, and it has been a basic industry for regional economic development. In this paper, it set a background that is the fiscal decentralization in 1994, which also caused decentralization of decision-making for local government. While the decisions on investment affected investment efficiency directly, so we want to find that how was the investment on infrastructure as quasi-public products, and whether the local government investment on infrastructure showed the effectiveness or ineffectiveness. The paper takes the relationship between fiscal decentralization and government investment behavior as the beginning, and uses the statistical data since 1994 as the base for empirical analysis. At the same time, it combines an important investment area——Dalian Changxing Island as an investment case. The author's ultimate goal is to provide a series of reasonable advices to achieve the max-benefits for infrastructure investment. In other words, it can be said that it makes a positive and practical significance for allocation of resources rationally.The paper has five parts and the main content as follows:Chapter 1 is the introduction part, which provides research background, purpose and significance of writing, etc.Chapter 2 is the theory part, which introduces fiscal decentralization and investment efficiency of infrastructure.Chapter 3 is the model analysis as a key part of paper. It analyzes the investment efficiency of infrastructure for Liaoning Province through establishing the DEA model.Chapter 4 analyzes the situation of infrastructure in Liaoning Province and makes a conclusion combined with the previous contents and the case.Chapter 5 is the last part as advices. It provides the strategies and recommendations for efficiency improvement in the basis of DEA model and the case.The conclusion of this paper can be summed up in two ways:Firstly, the conclusion by modeling:the effectiveness of infrastructure investment for Liaoning Province were different each year between 1995 and 2009, but it showed a trend of increasing returns to scale in the most of the years, which indicated that Liaoning Province showed a strong need for infrastructure investment during this period, but also showed that there was a certain lack of infrastructure investment. The result about the low efficiency gives the author an inspiration: during the process of infrastructure construction, we should take the first step from improving the efficiency of production factors, and then we can optimize the spatial distribution of infrastructure and perfect the decision-making methods so as to improve the efficiency of infrastructure services.Secondly, the conclusion by the case:there is a horizontal competition among local government which has led to a special type of infrastructure investment with significant, clear and quick growth effects. But this kind of regional economic growth has brought a series of long-term development impacts and negative effects, which reminds us that we should not always focus on pursuing of total infrastructure investment, but should stand at the point of resources allocation rationally.