The Statistical Study On The Influence Of Local Governmwnt Debt On Economic Growth

In recent years, in order to response to the impact of global financial crisis on China’s economy in2008, local government at all levels uses investment and financing platform to borrow money to increase the local public investment. The local government debt plays an important and positive role in promoting economic development and coping with the crisis, while there are also some problems needed to be concerned. Expanding fiscal gap and the rising government debt scale have aroused widespread concern. The important significance to study the effects of the local government debt on regional economic growth is getting further highlighted. Foreign scholars who study the effects of local government debt on economic growth are more and more, at the same time, there are abundant research results. However, because of the difference of the economic environment and political environment, the conclusions of foreign scholars may not reflect the actual situation of our country. Therefore, it is necessary to study this question according to the China’s specific situation. At present, China’s research about the effects of local government debt on economic growth is relatively few, affected by the availability of data, most scholars did not use relevant local government debt data to study, and had neglected the regional differences characteristics on the impact of local government debt on economic growth. Therefore, according to the local government implicit debt and explicit debt, this paper studies the effects of different type local government debt on the eastern and western economic growth.In order to better study the effect of local government debt on economic growth. Firstly, on the base of the analysis of the correlative researches, this paper tries to introduce the measure problem of local government debt and the connotation of local government debt under different statistical caliber, and make a descriptive analysis for the local government explicit debt and implicit debt. Secondly, this paper makes a correlation analysis between local government explicit debt and implicit debt and economic growth. Then, this paper uses the1997-2012panel data of31provinces and the proper model local to make an empirical research on the effect of local government explicit debt and implicit debt on economic growth. Finally, this paper proposes targeted policy recommendations according to the research results.According to the local government explicit debt and implicit debt descriptive analysis, we know that the absolute scale of local government implicit debt of China rises rapidly after2008. The absolute scale of local government implicit debt in the eastern areas increased rapidly after2008, the relative scale of the government implicit debt in Beijing, Tianjin and Shanghai fluctuates obviously, while other provinces is stable. The absolute scale of the local government implicit debt after2008grows significantly in the central and western regions of China, the relative scale is relatively stable. The absolute scale of the local government explicit debt shows a jump in the eastern and western regions of China after2008, and the relative scale increases significantly.The empirical results of the study show that the effects of the local government implicit debt and explicit debt on economic growth are not same. For the local government implicit debt, it has no significant effect on economic growth in the eastern region, and has a significant positive effect on economic growth in the central and western regions. But we don’t find the evidence of the local government implicit debt has a nonlinear effect on economic growth. For the local government implicit debt, it has a significant nonlinear effect on economic growth in the eastern and the central and western regions and the debt thresholds are19‰and33‰.