Research On The Mechanism And Impact Of Fiscal Decentralization On The Efficiency Of Fiscal Expenditure On Environmental Protection

The report of the 20 th National Congress of the Communist Party of China proposed that "improving the level of environmental infrastructure construction" is an important measure to achieve green development and promote the harmonious coexistence of human and nature.At present and in the future,the direction of environmental improvement lies not only in quantity,but also in quality.As the main body of regional environmental pollution control,local governments bear the investment pressure of environmental protection control.In recent years,the intensity of environmental protection expenditure has been increasing.During the "13th Five-Year Plan" period,the government’s financial expenditure on energy conservation and environmental protection has exceeded 3 trillion yuan,providing important construction fund support for regional environmental governance,energy conservation and emission reduction.Under the system of fiscal decentralization,local governments have greater financial decision-making power,can allocate financial funds according to local needs.Moreover,environmental protection departments are also restricted by local fiscal power in the actual ecological environmental protection work.Therefore,fiscal decentralization has a certain impact on the efficiency of government environmental protection expenditure.However,with the increase of investment in environmental protection year by year,the effect of environmental improvement is unsatisfactory,and there are still efficiency losses and waste of financial funds,which shows that there are still some problems in the scale,structure,management and other aspects of fiscal environmental protection expenditure.Therefore,we should evaluate the efficiency of our government’s environmental protection expenditure,further explore the impact of fiscal decentralization on it and its role path,and timely summarize the reasons for efficiency losses.It is not only conducive to improving the efficiency of government environmental protection expenditure,winning the battle of pollution prevention and control,but also conducive to optimizing the arrangement of fiscal decentralization system,and more effectively playing the role of local governments in environmental protection governance.In the context of China’s economic transition to green and low-carbon development,how to improve the efficiency of government environmental protection expenditure in the context of fiscal decentralization is a key issue to be solved urgently.On the basis of constructing the theoretical framework of fiscal decentralization affecting the efficiency of government environmental protection expenditure,and based on the panel data of 30 provinces from 2008 to 2020,this paper adopts the SBM-Undesirable model to measure the efficiency of environmental protection expenditure,uses causal inference and intermediary effect model to empirically test the mechanism and effect of fiscal decentralization on the efficiency of environmental protection expenditure,and further explore the regulatory effects of environmental regulation and green finance on the above effects.The results show that,first,the local government in China bears a large responsibility for fiscal expenditure,while the efficiency of government environmental protection expenditure in most regions is at the average level,and the efficiency loss is obvious compared with the optimal unit;the efficiency level in the eastern region is far higher than that in the central and western regions,and the regional gap is the main reason for the unbalanced regional development.Second,fiscal decentralization has significantly reduced the efficiency of local governments’ environmental protection expenditure,which is mainly conducted through three channels: the promotion motivation of officials,the ability to attract foreign capital and the pressure of fiscal revenue and expenditure.Thirdly,the heterogeneity analysis shows that fiscal decentralization in the eastern region is not conducive to the improvement of the efficiency of government expenditure on environmental protection,while the central region has a positive impact.Fourth,environmental regulation will strengthen the negative impact of fiscal decentralization on the efficiency of government environmental protection expenditure,while green finance plays a weakening role,which can alleviate the pressure of government environmental governance and make up for the loss of efficiency.Accordingly,this paper puts forward policy recommendations such as optimizing the official performance evaluation criteria,creating a "central and local co-governance" environmental protection expenditure mechanism,and improving the financial capacity of financial escort,in order to provide policy reference for transforming regional government functions and improving the efficiency of government environmental protection expenditure.The main innovations of this paper are as follows: First,in terms of research content,the impact of fiscal decentralization on government environmental protection investment is extended to the level of efficiency,and it is found that regional fiscal decentralization significantly inhibits the efficiency of fiscal environmental protection expenditure.On this basis,the impact mechanism of fiscal decentralization on fiscal environmental protection expenditure efficiency is systematically explained from three aspects,namely,the promotion motivation of officials,the ability to attract foreign investment and the pressure of fiscal revenue and expenditure,It provides a new reason for understanding the deep-seated reasons for the low efficiency of government-type environmental protection governance.Secondly,from the perspective of research,based on the environmental factors of national policies and financial markets,this paper discusses the regulatory effect of environmental regulation and green finance on the inhibition of local fiscal decentralization,which is helpful to enrich the second generation fiscal decentralization theory and Porter’s hypothesis.Thirdly,in terms of research methods,on the basis of constructing a new input-output index system,the use of SBM-Undesirable model to accurately measure the efficiency of environmental protection expenditure will help improve the scientific and targeted nature of government financial expenditure decisions.