Fiscal Transparency,Official Rent-seeking And Shadow Economy Scale:Theory And Empirical Evidence From China's Provincial Level

The official statistics of the state and the result of the study of scholars all show that there are serious shadow economic problems in our country.The shadow economy is usually difficult to measure.However,experts and scholars at home and abroad have calculated the scale of shadow economy by direct method and indirect methods,have achieved fruitful results.The causes of the shadow economy are also varied.Scholars at home and abroad are mainly studying from the economic and institutional levels.After the reform and opening up,China has a phenomenon of "high growth and high corruption".After the "Eighteen big conference",our external economic and social environment has changed a lot.The government's anti-corruption efforts have been continuously strengthened,and the number of government officials and state-owned enterprise executives investigated and dealt with is increasing.In recent years,there are more and more financial information of the provincial governments in China,and the financial transparency has been increasing.Under this background,this paper uses qualitative and quantitative methods,combining theory with practice,to study the influence of fiscal transparency and official rent seeking on the scale of China's shadow economy.First,according to the factors that affect the scale of shadow economy,this paper collate and summarize the related research both at home and abroad,and make a literature review,find out the progress and shortcomings of the research,and confirm the research direction of this paper.Then,on the basis of the original economic theories,this paper respectively discusses the mechanism of fiscal transparency and official rent seeking affecting the scale of shadow economy,and constructs a theoretical model,which provides a theoretical basis for this research.Subsequently,the paper used structural equation model(MIMIC)to calculate the shadow economy scale of our provinces(autonomous regions and municipalities directly under the central government)for 2006-2014 years,providing a basis for subsequent empirical research.Then,based on the fixed effect model(FE)and the generalized system moment estimation(SYS-GMM)method,the paper empirically confirms the mechanism of fiscal transparency and official rent seeking affecting the scale of recessive economies.Finally,this paper summarizes the conclusions of the theoretical and empirical study,clarifies the policy recommendations.Main conclusions drawn in this paper based on the above analysis:(1)the average scale of shadow economy in all regions of China is between 13%-17% in 2006-2014 years,with a downward trend in recent years,the scale of the hidden economy in Northeast China is relatively smaller;(2)the causes of the different regions of China shadow economy is different,showing obvious geographical characteristics;(3)the relationship between rent-seeking officials and shadow economic scale is inverted "U" type,which also has a substitution effect and complementary effect.(4)fiscal transparency has a negative direct effects and indirect effects on shadow economy scale,improve fiscal transparency can directly inhibit the hidden economy scale,and through two channels by lowering the level of rent-seeking officials and change the relationship between rent-seeking officials and shadow economic.