Leverage Rate Increasing In The Perspective Of Fiscal Decentralization Chinese Style

Since 2008,China's leverage rate continued to rise,which has caused extensive concern among policy-making organizations and the society.according to a new studies,state-owned enterprises and real estate companies in non-financial enterprises are the main providers of leverage,and both of these have a close relationship with local governments..Under the fiscal decentralization Chinese style,local governments can use the economic and social resources they have in hand to influence the scale and direction of credit funds.At the same time,under the promotion of performance evaluation system and financial pressure,local governments also compete for financial resources to expand investment in economic development impulse.This article believes that the degree of decentralization among different regions is basically the same,the difference is only the difference in incentive intensity,and then put forward two hypotheses,the greater the promotion pressure and financial pressure the local government faces,the higher the leverage ratio in the region.An empirical test of the provincial panel data from 2003 to 2015 proves the hypothesis 1 and hypothesis 2 of this paper.The results of the group regression show that after 2008,the profound changes in the domestic political and economic environment changed the orientation of local government behavior and increased the leverage effect of the leverage ratio.Then,classifies the samples from 2003 to 2014 into three groups of high degree of marketization,medium,and low according to the China Marketization Index.The results show that the marketization process can redress local government's "illness of financing thirst".