Analysis On The Equalization Effect Of Transfer Payment Among Four Regions In China

China’s four regional economics’ developments are imbalances, the gap of social development between provinces is large, and the level of basic public services which is provided by the local government is disparity. After the1994reform of the tax sharing system that through the financial transfer payment policy to compensate for the imbalances between vertical and horizontal in regional fiscal capacity. Horizontal financial equalization effects of the financial transfer payment will affect the inter-regional equalization of public services, thus contributing to regional economic development. Chinese economy was divided into four regions of east, northeast, central and western under the ’11th FIVE-TEAR PLAN’. This article is under the preliminary analysis of the differences between four regional economic and social developments, though the constructing the equalization model to analysis the equalization effect of financial transfer payment for China’s four major economic regions.This article narrow the scope of study, specifically study of the equalization effect of financial transfer payment by vertical transfer payments. This article study at domestic and abroad research results for the fiscal transfer payment system, summarized the theoretical basis and content of financial transfer payments to analysis the development process of China’s fiscal transfer payment, and analysis the status quo of the four major regional economic and financial equalization. Then, constructing the equalization model, statistics financial data of China’s four major regions between1994-2009to empirical analysis of the equalization effect of financial transfer payment, and explore the equalization effect of the four regional financial transfer payment. And use of the coefficient of variation and the equalization factors to analysis the equalization effect of China’s four regional and internal, concluded:the financial transfer payment has a certain degree of horizontal financial equalization effect from the overall equalization effect, but the financial differences of four regional economics are still large, there have deviate in the process of the financial transfer payment policy to achieve equalization target. Analysis through the31provinces, fiscal expenditure coefficient of variation was significantly less than the variation coefficient of fiscal revenue, the financial transfer payment to a certain degree of equalization effect. Between the four regional economics, the gap of per capita fiscal revenue was widening in15years, and per capita revenue of the east region always ranked first, through the financial transfer payment, per capita fiscal revenue and expenditure equalization coefficients to four regions from1994to2009was overall upward trend. From the internal view between four regions, four regional fiscal equalization effects from high to low were:northeast, east, central and western parts; from the results of transfer payments, the breakdown of tax rebates and institutional grants would inverse of the equalization effect, general transfer payments due to the smaller lead to the equalization effect is weak, and special transfer payments is complicated that the lack of regulatory constraints equalization effect. Therefore, we can through standardize the distribution basis and method of transfer payments, optimize the structure of the financial transfer payment, establishment of standard performance evaluation system of transfer payments, enhance the level of the equalization effect of the financial transfer payment through the supporting reforms of the fiscal transfer payment system, and to promote regional coordinated economic development.