Research On Legal Issues Of Local Government Bonds

In developed countries and some developing countries, Local government bonds have experienced a fairly long course of development with mature theory and practical experience. Raising money by bonds for local public goods provided is already an important financial support. China budget law prohibits local government issued bonds. However, the gap between financial income and the requirement of economic development is huge, local governments can only circumvent the prohibition law and issue bonds in Alternative methods, which brought a lot of legal and financial risks.Based on the above risks, this article uses the dual perspective of law and economics to find the solutions and try to remedy the defects by build the law framework of china bound law. The article also tries to balance between efficiency and fairness finding the best allocation for resource and improve the social welfare.This article is divided into five chapters, the first chapters introduce the present situation of Chinese local government debt and point out it significant problems. The second chapter introduces the experience for local government bonds of America, Japan, France and the United Kingdom. The third chapter is review of law, administrative regulations and rules for local government bonds summarized the laws and regulations of local government bonds, trust, bank loans and other local government financing mode. This chapter also discusses the defect of the regulations. The fourth chapter is about china’s local government bonds legal suggestions. The system structure built is a necessary condition for the economic healthy and orderly development.