The Analysis Of The Heterogeneity Of The Effect Of Province-managing-county Reform On Economic Growth In Dialects

The system is closely linked with economic growth.With the deepening of reform and opening up,China has carried out a series of reforms at the government level to adapt to the rapid development of China’s economy.Among them,the reform of the province-managing-county(PMC)that began in 2003 has provided good research data for the flattening of the government structure.In addition,the influence of China’s diversified cultural background on the economy has gradually attracted the attention of scholars,but the impact of this reform has not yet been studied.Considering that this reform has the nature of "quasi-natural experiments," this paper uses the difference-indifference method as a recognition strategy to solve endogenous problems.We use panel data from 1995 to 2007 to analysis of the heterogeneity of the effect of provincemanaging-county reform(PMC)on Economic Growth in Dialects.In the identification method,we choose the difference-in-differences method.The empirical results are as follows.(1)The PMC reforms have reduced the speed of economic growth,and differences in dialects have significantly aggravated the negative economic effects of the reform.After eliminating the impact of the county’s expansion of power reform and adding control variables,the results still remarkable.(2)Contrast with non-PMC counties,the tax revenues of the county-level and transfer payment of the county-level have increased,but differences in dialects have made both of the effects weaker.(3)Compared with non-PMC counties,infrastructure investment has also decreased.The differences in dialects have reduced the government’s infrastructure investment even more.(4)The effect of PMC reforms on farmer household income and per capita retail sales is significantly negative.And,the differences in dialects increase these negative effects.