Study Of The Influence On Economic Growth Of Inner Mongolia Fiscal Expenditure

As we all know, the superstructure is based on the economic determines, and theeconomic growth of one region plays a principal roles in its comprehensive development.Precisely, macro-control measures, to which fiscal expenditure policy belongs, areordinarily used by the Government to ensure sound and rapid economic growth. Thegovernment will adjust its size and structure that are two important focus of fiscalexpenditure so as to support its economic growth. Practice has proved that the fiscalexpenditure policy has become an effective tool in the Inner Mongolia governmentregulation of the economy. Well scientific and quantitative analysis to the effect of fiscalexpenditure policy, can effectively make sure appropriate fiscal policy’s suitability. As toInner Mongolia, in-depth analysis of the effect of fiscal expenditure policy to economicgrowth, which is provided with both theoretical and actual consequences, is conducive tothe full realization of the Inner Mongolia government macro-control functions.This article that is based on the theory of public goods, market failure theory, demandconstrained growth theory and endogenous growth theory, showed ways about how thescale and structure of fiscal expenditure to affect Inner Mongolia’s regional economicgrowth. Besides, with the help of Cobb-Douglas production function, it constructed severalnew function models respectively containing the total fiscal expenditure and fiscalexpenditure structure indicators. What’s more, several statistical methods such asCo-integration Analysis and Vector Auto Regression Model, Impulse Response andVariance Analysis, which are widely recognized, were used to make the analysis to1978-2010data more persuasive.The analysis showed that Inner Mongolia’s current fiscal spending too large. AndEconomic Construction Spending has little effect to economic growth, while Forestry andwater affairs, National Expenditure Management and Social Spending make positivecontribution to economic construction in Inner Mongolia. Finally, with the results ofquantitative analysis and current fiscal policy in Inner Mongolia, relevant suggestions weregiven.