Political Incentive、Fiscal Policy And Economic Growth

According to the existing findings, the view that the official has been playing aimportant role during the economic growing procession of our country whose incentivecomes from the political promotion has been proved. The examination systemcombining the official’s performance with the economic growth has been proved havingcertain simulative to the economic, but more disadvantages cause it to be denounced.This paper firstly makes a accurate definition for the political incentive, and thendoes some analyses on the fiscal performance and Position changes of governor orProvincial party committee secretary in twenty-nine provinces in China to explore thatwhether the influence of political incentive excites in the local fiscal policies, through aindex of political incentive and function of local fiscal. Based on it, we do carefulresearch on the relation between the fiscal policy and economic growth to test theexisted influence of political incentive, with macro data of provinces.The study found that the effect of political incentive actually existed and preformeddifferently in kinds of areas; and the consistent trend of fiscal policy and economicgrowth proved that more fiscal expenditure would simulate more economic growth.Gathering up the threads, we found the actual exist of political incentive effect, whichmake the official extend the fiscal expenditure, so as to promote the economic growthand in order to get a political promotion. But this effect will cause a lot of problemssuch as irrational fiscal policy which lead to high level of resource wasting and fiscaldeficit. So we suggest bidding farewell to the worship to GDP, making the official domore efforts in economic stability maintaining and people’s request about livelihood,building proper supervision mechanism and scientific budget constraints to reduceunreasonable fiscal expenditure.