The Relationship Between The Five Northwestern Provinces Of Fiscal Expenditure And TFP From Spatial Spillover Perspective

The whole area of the northwest five provinces is nearly 3 millions square kilometers,which is about 1/3 of China. The northwest five provinces is the frontier of "the Silk Road Economic Belt", also it is the link between Central Asia and Europe and the main covering areas of "the Silk Road Economic Belt".So the economic and social development of northwest five provinces plays an important role in the strategic layout of the whole country Under the background of "One Belt,One Road" and "the Silk Road Economic Belt" development strategy.The northwest five provinces develops rapidly in economic and social since the implementation of the western development strategy, the living standards of residents increases significantly in the five northwest provinces.Although the northwest five provinces develops rapidly,we should also find that there’s a lot of problems, mainly is the low quality of economic development.specifically manifested in the following aspects: The first, the economic growth mainly depends on investment phenomenon, and a large part of government investment in it, also is the public finance expenditure, private investment and stimulating consumption is not enough and lack of power and endogenous growth; The second, the transformation of economic development mode is slow, lagging far behind the eastern coastal economically developed areas, the regional economy is mainly the extensive growth mode, intensive economic development lost momentum;The third, industrial structure is unreasonable, the proportion of the second industry is too large, the first and third industry accounted for a relatively small; The fourth, the using of resources is inefficient, resources waste massive and environment pollute seriously.How to solve these problems? Need to optimize the structure of fiscal expenditure and expenditure efficiency to improve the quality of economic operation. In the past,the judgment on the efficiency of fiscal expenditure is mainly based on the fiscal expenditure and the relationship between the growth rate of GDP. This is one-sided and ignoring the intangible inputs to the comprehensive benefits of economic effect.Compared with the traditional economic growth rate, total factor productivity can be more comprehensive measure of economic growth.Thus, take the total factor productivity as economic growth indicators,analysis the relation between fiscal expenditure and total factor productivity, can reflect the comprehensive effect of fiscal expenditure better.On the other hand, the fiscal expenditure asthe main means of providing public goods has positive effects. The effect of fiscal expenditure, often beyond the scope of the diffusion area to other areas(spillover). Based on this, this paper through the establishment of spatial spillover model, the fiscal expenditure and total factor productivity analysis, analysis the impact of the five northwestern provinces of fiscal expenditure on total factor productivity.In this paper, through calculating the total factor productivity of northwest five provinces,understand the status and difference of output efficiency; on this basis, analysis the correlation between fiscal expenditure and TFP growth rate from the spatial spillover perspective. The specific content includes the following main parts: Firstly, we introduced the overall economic development of the five northwestern provinces. Secondly, we measured the total factor productivity by DEA-Malmquist method. The growth trends of total factor productivity of five northwest provinces have the similar trend,total factor productivity in five northwestern provinces in the continuous improvement process, but there is still room for improvement.Thirdly, the real diagnosis analysis method was used to analyze the relationship of financial expenditure and the total factor productivity(TFP) of the five northwestern regions with spatial spillover perspective. To probe the relationship between public finance,urbanization rate, traffic capacity and the ratio of openness and the total factor productivity,the spillover effect model between the financial. The total fiscal expenditure, education spending, tech spending and transportation expenses of the five northwestern provinces all promote the promotions of the rate of the total factor productivity in their regions. Besides,they have the positive spillover effect. Urbanization rate, transportation capacity, degree of opening to the outside world and the human capital were all positively correlated with the growth trends of total factor productivity. Finally, from the aspects of optimizing the structure of fiscal expenditure, combining the new urbanization construction with promoting trade cooperation, some relevant policy suggestions have been put forward to increase the promotions of the rate of the total factor productivity and promote the economic development of the five northwestern provinces.