The Impact Of Transforming Counties Into Districts On County Economic Growth

The Fifth Plenary Session of the 19 th CPC Central Committee stressed that regional coordinated development is an important path to promote high-quality development.County economy is the basic unit of China’s economic development,the cornerstone of regional development and the support of China’s high-quality economic development.So,county economy has a significant presence in China’s regional coordinated development.Local government plays an indispensable role in the development of county economy in China.As one of the means for local governments to promote economic growth,the reform of administrative divisions has accelerated gradually in recent years.Among them,the reform of transforming counties into districts is the most frequent way of administrative division reform,which helps the government to integrate county factor resources and optimize regional spatial structure.In view of the important role of financial development in county economic growth,financial resources have become the production factor actively sought by county-level local governments.For a long time in the past,optimizing the structure of land and financial elements through the reform of administrative divisions is an essential model for local governments to improve the development of county economy.So,what is the impact of the withdrawal of counties and the establishment of districts on the economic growth of counties?What role does financial development play in the above process? What is the law of heterogeneity between different types of counties? The answers to the above questions have important theoretical and practical significance for reexamining the economic effects of the reform of transforming counties into districts from the perspective of financial development,improving the supporting policies of the reform of transforming counties into districts,and promoting the high-quality development of county economy.Using the national county data from 2000 to 2019 and the Differences-in-Differences method,this paper tests the impact of transforming counties into districts on economic growth of counties.From the two dimensions of financial development depth and efficiency,this paper tests the intermediary effect of financial development in the process of the withdrawal of counties and the establishment of districts on the county economic growth.The study shows that the transformation from counties to districts can promote the development of county economy.The transformation from counties to districts promote the development of county economy by improving the scale and efficiency of financial development.Compared with county-level cities,the transformation from counties to districts plays a more obvious role in promoting the economy of non-county-level cities through financial development.Compared with the counties under the jurisdiction of sub provincial cities,the transformation from counties to districts plays a more obvious role in promoting the reform of county economy under the jurisdiction of prefecture level cities through financial development.The innovations of this paper are as follows,the first one is the innovation of research viewpoint.This paper examines the economic effect and influence mechanism of the withdrawal of counties and districts in the view of financial development,expands the research perspective of the economic effect and influence mechanism of the the transformation from counties to districts and helps to deepen the understanding of the financial operation logic and economic effect behind the administrative division reform.The second one is the innovation of research content.This paper empirically tests the impact of the transformation from counties to districts on county economic growth and the mechanism of financial development,and makes a series of heterogeneity analysis,which enriches the research conclusion of the economic effect of the transformation from counties to districts.