Empirical Study On The Effects Of Fiscal Policies On Upgrading Of Industrial Structure In China

Nowadays,China is in the period of structural transformation,Our inharmonious economic structure and unreasonable industrial structure have strangled our society.As one of the important measures,fiscal policy should be legitimately used to upgrade the industrial structure.By selecting data of 29 provinces during years of 2002-2015,this paper constructs the industrial structure upgrading index,the financial revenue and expenditure index and land resource index.Then,this paper establishes the dynamic panel model and PSTR model to study the impact of fiscal policy on the upgrading of industrial structure.From the empirical results,this paper finds that total fiscal expenditure will promote the upgrading of the industrial structure,while the total tax revenue has the inhibiting effects.The structure of fiscal expenditure and tax revenue varied a lot.Tax on commodities and expenditure on governing will have negative effect,while tax on consumption and expenditure on science and education have positive effect.From the prospects of land resource,when in low mechanism,land-transferring fees do good to the upgrading of the industrial structure,while in the high mechanism,the situation is different.There exist location parameters in east,medium and west,which are 0.654,0.693 and 0.312.When referring to the land related tax,those parameters changes to 0.151,0.323 and 0.374.From the data,this paper finds that there are several problems in our fiscal policy,such as follows.Expenses do not correspond to income,structure of expenditure and revenue is irrational,structure of tax revenue not fits the society well,land resource used unduly.So,the paper gives some suggestions.First,central finance should increase the amount of transfer payment on local industrial structure upgrading.Second,government should promote the reform of tax system to narrow the gap between enterprises.Third,adjust expenditure structure,for example,decrease the expenditure on governing and increase the expenditure on science and education.Fourth,control the scale of land transfer.Fifth,government should guide the social capital to increase investment in fixed assets.Sixth,improve the quality of Urbanization.Seventh,strengthen the economic adaptability of the central and western regions.