The Theoretical And Empirical Analysis Of The Influence Of Local Government Competition Behavior On The Transformation Of Economic Growth Mode

Since the tax-sharing reform,the competition between local governments has greatly promoted the economic growth of our country.But whether the economic growth under the competition of local government is high quality,how does the competition between local governments affect the change of growth mode?This paper studies this.Firstly,this paper describes the competition between Chinese local governments in detail from the incentive of competition to behavioral logic.Then from the tax competition and land transfer competition of the two specific behavior,the theory hypothesis and empirical test of the way to comprehensively study the impact of local government competition on the transformation of economic growth mode.Theoretically,based on the existing literature,this paper first expounds and demonstrates the tax competition and the competition behavior and system background of land transfer,and then analyzes the mechanism of competition behavior for the change of growth mode.Empirically,based on the data of China Provincial panel from 2004 to 2015,taking TFP as the indicator of the way and quality of economic growth,the paper empirically examines the impact of tax competition and land transfer competition on the transformation of economic growth mode and its influence mechanism.and using the differential GMM and the system GMM method to some extent to solve the problem of endogenous,the results show that the study is still stable.In particular,the conclusions of this paper are as follows;firstly,the tax competition between local governments and the competition of land transfer have promoted the economic growth,but under improper incentives,it has restricted the improvement of regional TFP and restrained the change of growth mode;second,The influence of tax competition on TFP is different in developed area and backward area.The proportion of fiscal decentralization and second industry is too large,which will aggravate the effect of tax competition on TFP;Thirdly,the mechanism of the change of the local government competition is:the land finance competition between local governments leads to the formation of regional biased investment,and reduces the investment ratio of regional research and development,Thus,it is difficult to provide support for economic growth to shift from investment drive to innovation-driven process.And although the land Low-cost competition can still improve the regional research and development expenditure ratio,but in the long run is not conducive to the improvement of resource allocation efficiency is not conducive to the change in growth mode.