Financial Decentralization And Intervention Deviation Of Local Government And Industry Imbalance

Under the system of fiscal decentralization,local government is in two types of competition at the same time-both for the region ' s economic output and fiscal revenue and competition for their own political promotion again at the same time.To cope with the pressure of local financial revenue and expenditure,gain achievements,local officials have great incentive intervention local industrialization process,it is beneficial to raise taxes on the one hand,at the same time also can promote local economic growth in order to improve the performance,However,the development of local government intervention in the local industry,the relative preference those short-term internal energy form benefit or see "effect " project,capital-intensive industries,under the intervention to this industry,the development of labor-intensive industries often ignored by policy and essentially,for a long time in the past,can cause labor intensive and capital intensive industry development gap between increased,leading to regional industrial development imbalances,and bring a series of negative consequences.Under the fiscal decentralization system,the official promotion is based on performance considerations,the local government attaches great importance to and support the degree of different types of industry presents the obvious differences,in general,the economy is relatively backward area caused by a lack of financial resources of government,local government revenues and expenditures,the greater the pressure tend to put more limited resources into support capital-intensive sector,the government for financial resources and relatively developed areas is relatively abundant,in support of capital-intensive industries at the same time,there are some result,local finance resource is insufficient,capital-intensive manufacturing and labor-intensive manufacturing development indicators,the greater the difference between the local industry development imbalances,the more serious,this brings underemployment,decreased resource allocation efficiency,resources and environment pressure and a series of adverse consequences.With GDP growth for the first goal,employment is also one of the objectives,performance of local government.In general,the local government financial situation worse the more attention to production value target,the target,the government intervention may cause the result of labor-intensive manufacturing industry and capital-intensive manufacturing employment index difference expansion,good local government finances under the precondition of development of GDP will be more employment goals.Based on the provincial panel data from 1998 to 2008 were analyzed,and the focus on fiscal decentralization under the system of local government industry bias caused by the intensity factors of different manufacturing development imbalances.Based on the theory of literature and empirical facts,we propose a fiscal decentralization,local government behavior,performance difference between the research hypothesis of industrial development,and proposes the theoretical hypothesis of empirical test,according to different regional panel measure to compare the proposed merger,form two aspects of overall and regional comparison of local government industry bias analysis explain the relationship with industry development imbalances.Through the empirical analysis,fiscal decentralization variables(FD)is caused by different elements concentration differences in manufacturing jobs and output growth.After confirming the bias and intervention of local government behavior will cause the labor-intensive manufacturing and capital-intensive manufacturing development imbalance,resulting in overall industry such as lack of employment and a series of consequences.