Local Fiscal Capacity Differences Of Public Service

Chinese economic and social structure is undergoing profound transformation, acomprehensive upgrade aspiration of the people in economic and social developmentand transformation process. The progressive realization of the functions ofgovernment changes from versatile into service-oriented, the focus turned toproviding high-quality public services, safeguard social fairness and justice. In recentyears, increasing government investment in public services, improve service quality,increase the supply of public services scale. However, the shortage of public service,service capacity is weak, significant differences between regions and other issues arestill outstanding and thus lead to a series of social contradictions and problems,economic, social stability and development constitute a potential threat. Therefore,improving the ability of local finance public services, improve local public services,the supply of public services to ease the differences between regions, is sharing thefruits of development to become a fundamental national security.Local fiscal capacity of the public service, is the local government for the uniquenatural and cultural features of the geographical features of the system under certainconditions, the use of financial tools to access, use and deploy a variety of financialresources, power resources, information resources and institutional resources toprovide the level of compliance with local economic development, public services tomeet the organizational capacity of local residents of various levels of consumersociety needs. Local fiscal capacity of the public service is a public resourceextractive capacity of local governments, fiscal capacity allocation of public resources,local governments the ability to regulate cluster of public resources.Comprehensive Evaluation of the ability of public services to local fiscalcapacity of the three as a starting point, the status quo describes the ability of localfinancial breakdown of public services. Overall, the ability of local governments todraw public resources, local financial allocation of public resources and local fiscal capacity of public resources have shown the ability to regulate the situation continuedto improve, but the issue highlights the differences between regions. Breakdown ofview, local fiscal capacity of public resources to learn more than the minimum easternMidwest, central region; local governments the ability to configure the eastern part ofthe highest public resources, public resources allocation structure biased in favor ofeducation, social security and employment; local governments the ability to regulatepublic resources still insufficient, smaller vertical adjustment of public resources,special transfer large proportion of public resources while the lateral adjustment scaleand intensity increased, but the regulation is weak, the lack of rules and norms.Using Their index decomposition method further explore the local fiscalcapacity differences found in the public service, as well as internal differencesbetween regional differences eastern region is the main cause of differences in localfiscal capacity to draw public resources allocation of public resources and local fiscalcapacity. Local fiscal capacity of public resources to learn the difference cordon hastouched the Ginny coefficient, inter-regional differences in tax effort to further limitthe ability of local governments to draw balanced development.Decomposition method based on the difference between the return on localfiscal capacity of public services cause analysis found that, first of all, regionaldifferences in per capita GDP, leading to differences in local fiscal capacity of keypublic services, incentives, economic development must be to promote theequalization of public services, local fiscal capacity equalization. Secondly, thestructure of fiscal expenditure for the financial contribution of local public servicecapacity gap in second place, which means that local fiscal expenditure structurereform to promote the role of public services for local fiscal capacity, is strong.Finally, revenue decentralization, transfer payments and factor mobility contributionrate in order in the third, fourth and fifth. These results suggest that the key toimproving the current differences in fiscal capacity of local public services is thebalanced development of the regional economy, the most important means to optimizethe structure of fiscal expenditure and improve the financial management system. Based on the findings, according to local conditions conducive to enhancing theability of proposed policy advice: First, to improve public resources to improve localfiscal capacity to learn, to improve the local tax system and strengthen the efforts ofthe local government tax revenue as a starting point; second is to increase the size ofthe public service spending optimize the structure of public service spending, thestrengthening of local financial resources allocation capability; third is to improve theexecution of government policies, improve the transfer payment system, improvingfinancial regulation of public resources.