The Empirical Test Of Fiscal Expenditure On China’s Macroeconomic Growth And Fluctuations

Under the conditions of modern market economy, fiscal policy is one most importantpolicy tool of government intervention in macroeconomic and financial expenditure is animportant tool for the implementation of fiscal policy. Studding financial expenditure ispractical significant to the effectiveness of macro-control problems.In this paper, we mainly analyze the relations of fiscal expenditure size with China’seconomic fluctuations, the relationship of China’s economic fluctuations with the structure offiscal expenditure and detailed composition of fiscal expenditure according to application ofthe HP filter method, atypical analysis, VAR dynamic model, econometric model. Thus wecan judgment that if there is effective of macroeconomic regulation and control for China’sfiscal expenditure policy.The test showed that there is no a significant relationship between the economic growthrate and fiscal spending which indicates that the long-term economic potential growth isdriven by the production conditions (labor, capital, technology, technology). When it comes tothe short-term fluctuations, there is a significant relationship between the economic cyclefluctuations and fiscal expenditure relative size with reverse, and it is more obvious after1998.It is indicated that China’s fiscal expenditure played a certain role in the ironingeconomic fluctuations. In addition, the various components of fiscal spending affect economicfluctuations in different directions. Some Policies and measures for the conclusion is got inthe final.