Empirical Research On The Indicator Warning Method Of The Early Warning To Local Government Fiscal Risk

In china, the study on Early Warning System of local fiscal risk is increasinglyimportant. Because local fiscal risk can transfer to central government and threaten thefiscal stability and economic stability and even the social stability, we must treat thisissue seriously. The local government liability, especially local government contingentliabilities, is accumulating, so we must construct local fiscal risk Early Warning Systemto warn the potential fiscal risk.In this paper, we construct a general framework of local fiscal risk Early WarningSystem. Through systematic analysis of fiscal risk indicator, we choose some importantand practical indicator to warn the fiscal risk.In chapter one, we mainly discuss target, method and significance of local fiscalrisk Early Warning System. In chapter two, we discuss the framework of local fiscalrisk Early Warning System. In chapter three, we discuss the reason and performance oflocal fiscal risk. In chapter four, we analyze the indicator comprehensively throughdividing the indicator into internal fiscal risk indicator and external fiscal risk indicator.In this chapter, we discuss all factors that may affect the local fiscal risk. In chapter five,we construct four kinds of indicator system that reflect local fiscal risk from differentperspectives. In chapter six, on the basis of theoretical studies of the previous chapters,we use the data of Shanghai statistics from the year2002to2011, the empirical studyresults show that the overall local fiscal risk of Shanghai at low alertness state in thepast decade except a few years. In chapter seven, we discuss the limitations of EarlyWarning System of local fiscal risk and analyze how to improve Early Warning Systemof local fiscal risk. Finally, a full review and analysis of the relationship between theearly warning system and real fiscal risk is taken to indicate that the precaution of fiscalrisk is very important.