Chinese Style Fiscal Deeentralizatio Gains And Losses: Theory And Empirical Research

After the reform and opening up, China’s economy through32years of growth, the GDP in2010and beyond the Japan to become the world’s second, is called "Chinese miracle". After the motive force of the economic development, found that of the local government financial expenditure for economic growth has an important and positive role. The local government of China’s development become growth government, and economic decentralization has close contact. But, decentralization is a kind of common phenomenon, through and other countries, especially the comparison of Russia, and found the same is decentralization, does not necessarily bring the same economic development effect. This and the politics of our country system are inseparable, economic decentralization and politics in the vertical management system closely, formed the Chinese the decentralization of power. This model has two successful place:one is through the fiscal decentralization and effectively financial incentives to ensure the local government from the course of economic development to share the results; the second is the central government to GDP is the core of the assessment mechanism of formation political fierce, ensure the local government behavior tend to become the economic development of "the hand of support" rather than "plunder hand". The two aspects of the design explains why the Chinese government so crazy about economic growth especially infrastructure construction.Through empirical analysis proves the fiscal decentralization can bring to China economic growth, but through to our local financial expenditure structure analysis of data, the Chinese fiscal decentralization to China’s economy also brought a series of negative effects, found that local financial expenditure structure formed a "heavy economic construction, light manpower capital investment" a pattern, this pattern is not conducive to the sustainable development of China’s economy.Through the investigation of the decentralization of Chinese we found that fiscal decentralization system especially the tax reform of the public finance system formed after, created a "move up and down the income function" pattern, lead to local government funds and the consistency of don’t match, local government and do not have enough money to complete all of its functions. And in vertical political system under, formed the GDP of the scale for local government competition. Under the background of again, in order to fight for limited opportunities for advancement, local government without exception of choice will be limited financial resources into short-term effect is more apparent economic construction, especially infrastructure construction in go to, and choose to ignore the long-term effect is obvious, but in the short term and cannot ascend the thing science-education-culture-health aspects. Therefore, based on the decentralization of Chinese institutional framework, this paper attempts to propose optimization system of local government financial expenditure structure Suggestions and countermeasures:the financial system, we should perfect the tax reform, thus change local government financial resources and powers do not match the pattern; Achievement motivation, change to GDP as a single index assessment and the achievements of the incentive system, the introduction of more reasonable scientific index, leading the local government into a benign sustainable development direction.