The Correlation Study Between Regional Economic Development And Fiscal Expenditure In Guangdong Province

Fiscal expenditure as an important means of China’s macro-control, has attractedthe attention of scholars over these years. Especially after the reform and opening up,fiscal expenditure on the level of regional economic development has been a hotspotof domestic and foreign scholars. In the years of theoretical study and empiricalanalysis from the domestic and foreign scholars, has been proved that fiscalexpenditure plays an essential role on economic development, however, previousresearch on regions failed to pay enough attention to spatial correlation. In the realworld, especially in the spatial data problems, the spatial correlation is an objectivereality. In this case, if we ignore the spatial correlation between regions, and use thetraditional economic model to analyze, we will inevitably lead to the deviation of theanalysis results, and impact the correctness of the conclusions. Therefore, we need toconsider the impact of spatial effects to the area in the study of regional development,joining spatial effects in the traditional economic model, namely the introduction ofspatial weight matrix, using spatial econometric model to analyze. So in this paper,we choose Guangdong Province—the most representative in the economicdevelopment as the research object, to study the relationship between the level ofregional economic development and fiscal expenditure from the spatial econometricperspective.Firstly, starting from the analysis of Guangdong Province’s economicdevelopment trends and financial development, studied the Guangdong Province’seconomic growth and financial development since1978. And analyze the spatialcorrelation on the level of economic development and fiscal expenditure inGuangdong Province through the measurement software. Then, compared theestimation results of OLS model, SLM model and SEM model, selected the mostappropriate model for analysis, draw the following main conclusions:(1)The level offiscal expenditure in Guangdong Province has a spatial correlation, and the spatialcorrelation is positive effect.(2)Owing to the improve of the liberalization of themarket economy in recent years, fiscal expenditure in Guangdong Province hascontinuous strong impact on the level of economic development, and became weakernow.(3)The level of economic development in Guangdong Province has a spatialcorrelation, but due to the impact of financial crisis and the debt crisis in Europe, theeconomic cooperation between the regions has been hampered, leading to spatial effects experienced weak, strong, weak trend.(4)Guangdong Province’s Pearl Deltaregion is higher than the other three areas in the level of economic development andfiscal expenditure, with a significant advantage. At the same time, because of thebackward areas will follow the example of the developed areas, the Pearl Delta regionhave a significant spatial correlation that will affect the development of other areas.