The Classified Regulatory Research Based On The Different Risk Preference Game Of Local Government Debt Financing

Local governments have the need to finance through debt, to provide public goods and to improve the level of local welfare, but with the diversification of the debt of local government behavior, the continuous expansion of debt the risk is becoming more and more big, causing great concern to the relevant authorities and society. Then the regulation of local government debt financing is becoming the focus of the related research. The author from reading the literature of supervision system of most studies, finding they mainly focused on the policy guidance of “one size fits all” type, the local government didn’t classify and put forward corresponding countermeasures. But in reality each local government administration based on the resources endowment, officials traits, such as the economic level of different show different risk preference, so the "one size fits all" type of debt obviously lack of rationality and targeted regulatory measures. Specific as follows:First, the paper narrates the writing background and significance, related research status at home and abroad and the text content and methods of writing, then the related concepts and relevant theory of local government debt financing are introduced. The historical evolution of our local government debt financing, and the result of debt financing is described from the size and structure, reveals the risk existing in the current local government debt, on the basis of the sustainable of local government debt in the unit root test, found that is not sustainable, explains the urgency and necessity of regulation of the above, and then to our country the status quo of the current regulation are introduced.Again, this paper uses game theory analyzing the regulators and the local government financing platform which has different risk appetite. First for the game model of supervision objectives, profit and cost of financing platform, regulators, and assume that the appetite of financing platform and the game model design to the optimization of conditions, the excess return of measuring variables defined. Respectively based on the analysis of the strong regulation and the weak regulated by regulators to risk neutral and risk type pursuit of high efficiency and low efficiency of local government financing platform game result.Then, from the perspective of empirical risk as the benchmark for 16 provinces in China’s local government debt, first set the three level index of the static, dynamic risk and structural risk, risk and affiliated nine secondary indexes. Secondly by analytic hierarchy process(AHP) to primary index weights were estimated; Again through 16 provinces related basic data, using the entropy method of nine secondary index weight; And then through the secondary index and basic data for 16 provinces from the perspective of primary index to the sort of debt risks; Finally, according to the empirical results regulate the relevant conclusions are drawn.Finally, based on the related subject of gambling behavior analysis and 16 provinces of local government debt risk classification evaluation, make the suggestion about how to improve the effectiveness of the regulation of local government debt financing.