Fiscal Spending And Upgrade Of Industrial Structure In Our Country

The period of the12th Five-Year is a critical period of building a well-off society, and is also the critical period for the transition of the economy and the upgrading of the industrial structure. The acceleration of the transformation of the economic development mode in China will lead to a profound change in the economic field, which is related to the reform and opening-up and the overall situation of socialist modernization. The transformation is of great significance to the improvement of the socialist market economic system, the maintenance of social stability, the promotion of urban and rural areas, and the development of regional economy.Based on the CD function by inserting government expenditure, the data of29provinces from1978to2006was used to analyze the impacts of government expenditure on China’s industrial upgrading by using the panel data model. On the one hand, we focus on the impact of the financial expenditure at the macro level, which is the aggregation of government expenditure, to the industrial structure; on the other hand, we pay attention to the various impact of the financial expenditure at the micro level, which is the structure of government expenditure, to the upgrading of industrial structure respectively. Based on this method, we implement empirical analysis on the basis of dividing the country into different region.The results show that government expenditure, at the macro, plays a strong role in the upgrading of the industrial structure; government expenditure, at the micro level, is excellent in terms of culture, education, science and public health which promotes the upgrading of industrial structure, and the rest of the government expenditures shows various effects on industrial structure upgrading, some of them even have adverse impact on industrial structure upgrading.