Research On Local Government Debt Management Based On System Dynamics

Since 2010,with the rapid growth of local government debt,the local government debt ratio and overdue debt ratio have gone up.In order to solve the problem of local government debt growth,in 2015 issued a new budget law,the provisions of the local government is not only from the financing platform debt,financing through the issuance of bonds,and the central government to implement the principle of no relief.In this context,this paper takes the management of local government debt as the starting point,establishes the dynamic model of debt management system,and studies the problem of local government debt financing.The main research results and conclusions are as follows: firstly,aiming at the limitations of the existing debt prediction model,a dynamic prediction model of debt management system is established.In the process of government debt management,the government to promote the healthy and sustainable development as the goal,through the debt management system abstract and assumptions,the dynamics equation is established,the government debt scale,debt ratio,debt financing forecast.Through the establishment of a system dynamics model of government debt management is simulated to predict the future government debt scale,debt ratio and debt financing,will show the existence of government debt management problems in the form of debt forecast.With the help of numerical computing power,any one indicator at any one point in time can be simulated,and the operation can arbitrarily change the initial values and parameters to dynamic monitoring system of local government debt.Second,taking Guizhou Province as an example,to test the stability of dynamic debt management system model,and the sensitivity analysis,the paper comes to the conclusion: GDP growth rate and revenue growth rate has negative influence and sensitive rate of debt,long-term debt ratio and growth rate accounted for fiscal expenditure on debt rate have a positive effect but not sensitive.Therefore,the policy implications of this article are that,in order to guard against debt risks,the first step is to develop the economy and obtain more revenue.Secondly,measures should be taken to reduce fiscal expenditure and issue more short-term bonds.Innovation and application value of local government debt management in the past often use qualitative,linear or static methods to study,using system dynamics method,using quantitative,nonlinear and dynamic approach to the study of local government debt management,which can enrich the existing literature from the aspect of method.In addition,previous studies often use the existing model and the modification of theexisting model to study the problem of debt management innovation,thus creating a hitherto unknown debt management system dynamics model is relatively large.The local government can not only predict the change trend of local government debt and debt through debt management system dynamics model,numerical control of the debt ratio in the range of acceptable,if the model predicts the debt ratio is too high,the government may need to take some measures to prevent the debt crisis.And by changing the value of some parameters,simulation results of different values,to study the effect of these parameters on the rate of change of local government debt,to select which variables to control the regulation of debt rate,the debt management system dynamics model has a certain application value.