The Research On The Problems And Countermeasures Of The Elimination Of Backward Production Capacity Of Local Government

Backward production capacity, which is resulted in extensive economic growthpattern and featured with high energy cost and pollution, low techniques and weakprotections, has been holding the long term development of economy.Consequentially, an elimination of lagged capacity has become a requirement for theoptimization of industrial structure as well as a major path to promote energyconservation and emission reduction and to shift the development pattern of economy.Since the1980s, the government has launched a series of measures to accelerate thiselimination, yet it is still a long way to go to meet the demand of economicdevelopment despite of the many great achievements that have been made. Localgovernments, which are the main force to carry out public policies, have a very directrole to play in the realization of this goal of elimination. Local governments take theleading part in economic guidance, legal protection and social management forregional development, thus it is of great importance and meaning to study theproblems that are facing with the elimination of backward production capacity fromtheir light with the hope of speeding up this process of development.Standing on market failure theory, principal-agent theory, and so on, thisdissertation studies the problems that are confronting the local governments in termsof the elimination of backward production capacity from five aspects, namely,ideology, regulations and policies, joint law enforcement, proper arrangement andlong effective constraint. Problems could be caused by multiple factors such as theconstraint of system in tax-distribution of finance and attainment of performance, theinfluence of the decisions made by local governments and the enterprises and thedemand of market that depends on lagged production capacity. And on this basis,specific methods could be found to address the problems: to better motivate the localgovernments through transforming the concept of development; to improve thestandards of elimination and the details of implementation and to set up economicguidance policies accordingly; to deepen the joint law enforcement of relevantdepartments; to make proper arrangements for the eliminated companies and theirstaff; to establish and improve the long effective constraint mechanism that includesevaluation, accountability and supervision. With the above mentioned problems andsolutions in mind, this paper hopes to help address the elimination of backward production capacity and offer useful preferences for the local governments.