The Influence Of Provincial County Reform On The Economic Growth Of Prefecture-Level Cities

In the more than 30 years after the reform and opening up,how to achieve rapid economic growth has been the focus of attention of all walks of life in China.Local governments,in fact,also have more or less the value-added competition for GDP.In a long time,China has adopted a local administrative system of municipal county,the purpose of which is to give full play to the role of prefecture-level cities in driving regional economic growth.However,under the background of tax distribution,with the economic development,the problem of regional economic uncoordinated and unbalanced is becoming more and more prominent,and there is a growing tendency among regions to compete for various resources,including financial means.In order to solve the problems of "City and county competition" and promote the development of county economy,the provinces,with the support of the CPC Central Committee and the State Council,have begun to actively implement the reform of Provincial County.Provincial county reform refers to the provincial government taking over some of the counties under the jurisdiction of the prefecture-level cities without changing the administrative hierarchy of the prefectural prefecture,and the provincial government departments are responsible for directly leading the economic,financial and other affairs of these counties.Prefecture-level cities play an important role in the practical effect of reform.Prefecture-level cities are part of the overall effect of reform due to the impact of reform,and to a large extent determine the degree of cooperation of prefecture-level cities in the reform,but policymakers and researchers tend to ignore this point.Therefore,under the background of the continuous popularization of provincial county reform,studying the influence and mechanism of provincial county reform on the economy of prefecture-level cities is helpful to make a more comprehensive and accurate evaluation of the overall effect of the reform,And how to implement the supporting reform to reduce the adverse impact of the reform and how to establish an effective mechanism to encourage the prefecture-level cities to give full play to the responsibilities of the reform and thus achieve better reform results has a certain guiding role,therefore,this topic is important and meaningful.After the reform of Provincial county,on the one hand,the financial subsidies at the county level and the special funds are directly allocated by the provinces,the tax pre-accounts are directly directed by the provinces,the prefecture-level government is no longer responsible for the county financial affairs,blocking the fiscal relations between the cities and counties,on the other hand,after the county No longer responsible for the management and approval of county economic Activities and project investment,expand the economic autonomy of county-level governments,and reduce the economic ties between prefectural cities and counties.Provincial county reform has changed the more stable and favorable economic and financial network built by prefecture-level cities in the regional economy,which in turn affects the economic growth of prefecture-level cities.Based on the theory of fiscal decentralization and the theory of local government competition,this paper analyzes the influence of provincial county reform on the economic growth of prefecture-level cities and the mechanism of its action.Based on the panel data of prefecture-level cities in the 2004-2016,this paper uses the double difference model to carry on the empirical analysis,the empirical results show that the provincial county reform can significantly promote the economic growth of prefecturelevel cities,and then use the PSM-DID method to carry on the robustness test,obtains the same result.On this basis,the intermediary effect test method is used to test the influence mechanism of the reform,and the regression results show that the reform mainly affects the economic growth of the prefecture-level cities from two aspects: the restraint mechanism and the competition mechanism of the prefecture,and the(1)The reform reduces the behavior Restricting the behavior of the prefecture-level government to expand fiscal revenue and expenditure has strengthened the financial constraints of the prefecture-to-city cities,and then stimulated the city-to-city governments to improve the efficiency of expenditure and develop the enthusiasm and spontaneity of the territorial economy,and promote the economic growth of prefectural cities;(2)The reform has improved the county economy and authority,And then improve the level of external competition faced by prefecture-level cities,at the same time,restricting the prefecture-level government through fiscal expenditure to form the economic competitiveness,hindering the economic growth of prefecture-level cities.From the net effect of two kinds of utility,the positive effect of the constraint mechanism is greater than the negative effect of the competition mechanism.In view of the analysis and conclusion of this paper,some feasible policy suggestions are put forward in view of how to reduce the impact of reform on the economy of prefecturelevel cities and how to motivate the enthusiasm of the city in the reform.