The Impact Of Fiscal Expenditure In Jiangsu Province On Regional Economic Convergence

With the emergence of new theory of economic growth since the mid-1960-s,differences in regional economic development level and its change trend has become one of the problems in the economic growth theory.Neoclassical growth model with technological advances to explain the differences in economic growth,it considers the marginal product of capital is decreasing,if elements can free flow between regions,then under the function of market mechanism,regional output or income per capita will tend to equilibrium,namely,the low level of per capital output of the region has a higher growth rate,and higher levels of output per area with low growth rate,they eventually converge to the same level of per capital output.Economic growth theory to the phenomenon known as the convergence of economic growth.The convergence hypothesis gives the powerful explanation to the long-term trend of economic growth and economic differences between regions.So,around the the convergence and its reason,and the convergence speed,scholars have carried on the thorough discussion.Early convergence studies abroad focuses on the empirical test whether there is convergence between countries as well as the rate of convergence.Later research attention from the convergence between countries to research a instead of regional convergence.At the same time,the new economic growth theory to question the convergence hypothesis,think of new classical thought convergence phenomenon in the world economy is not common,there are even some scholars analyze the phenomenon of regional economic divergence.Chinese scholars mainly focus on the study of Chinese economic growth convergence between each provincial administrative region.Its analysis can be divided into two kinds:one kind is to use a variety of indicators of China's economic growth and regional economic difference measurement and decomposition;Another kind is to China's actual economic growth performance and convergence characteristics provide theoretical explanation.Since the reform and opening up,China's regional economic gap is widening trends,for this country to carry out the strategy of regional development,has achieved remarkable achievement,between provinces of the nation's economic gap is slowly closing trends.But at the same time,regional economic disparity is very big,to further narrow the gap between regional economy has become an important problem in the development of our country's economy.Jiangsu province regional economic gap between the status quo is a miniature of the gap between China's overall economic situation,the jiangsu province regional development strategy is also taken to narrow the gap between regional economy,therefore,this article will research from the national narrowed down to jiangsu province,which can provide advice to coordinated economic development of jiangsu province,and to other parts of the country and even the study of economic gap has used for reference.Economic growth convergence theory tells us that the factors that affect the convergence of regional economic growth may be because of various reasons could not improve the convergence of regional economy,the government will need to create favorable convergence conditions,strengthening lead to convergence of policy mechanism,effectively reduce regional economic gap.The policies of the government create economic convergence mechanism,is one of the important means of fiscal expenditure,then fiscal expenditure can promote regional economic convergence? Fiscal spending is a part of total spending to promote regional economic convergence? The problem is to solve the problem in this paper.So we have the paper of the research on the effects of regional economic convergence.Around the purpose of this study,this paper made the following arrangements on the structure and content.Firstly,the introduction mainly introduces the research background,purpose and significance of this article and research methods.Chapter 2 at home and abroad on fiscal expenditure and economic convergence were reviewed,and the convergence theory of economic growth and the basic theory of fiscal spending review.Chapter 3 mainly analyzes the fiscal expenditure scale and fiscal expenditure structure on economic convergence respectively,the influence of the theory basis for this article.Fourth chapter mainly analyzes the convergence of regional economy of jiangsu province and the status quo of fiscal expenditure and differences,and puts forward the corresponding problems to solve,make matting for the next chapter the empirical analysis.Chapter 5 for jiangsu province to study the impacts of fiscal expenditure on the regional economic convergence.Of fiscal expenditure and fiscal expenditure structure's influence on the regional economic convergence to establish the empirical model,analysis of fiscal expenditure impact on regional economic convergence exists.Chapter 6 is the policy recommendations.Chapter 7 is the full text summary.The results show that before did not join the variable of fiscal expenditure,economic growth in jiangsu province and south jiangsu area economic convergence,there is no economic convergence and middle and north jiangsu area.After join the fiscal expenditure scale,convergence speed of the whole jiangsu province is speed up,but the three areas do not get good convergence.And the addition of fiscal expenditure structure variables,speeded up the whole jiangsu province and the convergence rate of the sunan region economy,the economies of the middle and north jiangsu area from divergence to convergence.Fiscal expenditure scale is an important factor to influence economic growth convergence,and the fiscal expenditure scale in jiangsu province to a certain extent hindered the convergence of regional economy of jiangsu province,so we need to adjust the fiscal expenditure scale from region to region.Significant conditional convergence of regional economic growth in jiangsu province,the convergence condition for economic construction expenditure,science-education-culture-health expenditure of fiscal expenditure,social security and administrative services.Therefore,each region should strengthen local fiscal macro-regulation,optimize the structure of fiscal expenditure.