| ECONOMICS AND MANAGEMENT |
|
|
|
|
|
Fiscal decentralization, fiscal squeeze and local government revenue and expenditure restructuring |
| ZHANG Yuan1, WU Binzhen1,2 |
1. School of Economics and Management, Tsinghua University, Beijing 100084, China;
2. National Institute for Fiscal Studies, Tsinghua University, Beijing 100084, China |
|
|
|
|
Abstract This study investigates how local governments restructure their revenue and expenditure in response to fiscal stress resulting from changes in fiscal decentralization. The exogenous policy shock of income tax sharing in 2002 is analyzed using the difference-in-difference method to solve the endogeneity problem. The results show that prefectural governments faced with increasing fiscal stresses tend to maintain their revenue and expenditure levels by various revenue tools but they change their expenditure structures. Prefectural governments with larger income losses increase their reliance on non-income taxes and government funds and prefer to increase their infrastructure expenditures.
|
| Keywords
local finance
fiscal squeeze
expenditure
tax sharing
|
|
Issue Date: 19 November 2019
|
|
|
[1] HAN L, KUNG J K S. Fiscal incentives and policy choices of local governments:Evidence from China[J]. Journal of Development Economics, 2015, 116:89-104.
[2] 席鹏辉, 梁若冰, 谢贞发, 等. 财政压力、产能过剩与供给侧改革[J]. 经济研究, 2017, 52(9):86-102. XI P H, LIANG R B, XIE Z F, et al. Fiscal stress, excess capacity and supply-side reform[J]. Economic Research Journal, 2017, 52(9):86-102. (in Chinese)
[3] 席鹏辉, 梁若冰, 谢贞发. 税收分成调整、财政压力与工业污染[J]. 世界经济, 2017, 40(10):170-192. XI P H, LIANG R B, XIE Z F. Tax sharing adjustments, fiscal pressure and industrial pollution[J]. The Journal of World Economy, 2017, 40(10):170-192. (in Chinese)
[4] CHEN S X. The effect of a fiscal squeeze on tax enforcement:Evidence from a natural experiment in China[J]. Journal of Public Economics, 2017, 147:62-76.
[5] 谢贞发, 范子英. 中国式分税制、中央税收征管权集中与税收竞争[J]. 经济研究, 2015, 50(4):92-106. XIE Z F, FAN Z Y. Chinese-style tax-sharing system, tax collection centralization and tax competition[J]. Economic Research Journal, 2015, 50(4):92-106. (in Chinese)
[6] JONAS J. Great recession and fiscal squeeze at U.S. subnational government level[R/OL]. Washington DC, USA:International Monetary Fund, 2012. DOI:10.5089/9781475505320.001.
[7] INNES D, TETLOW G. Delivering fiscal squeeze by cutting local government spending[J]. Fiscal Studies, 2015, 36(3):303-325.
[8] 周黎安, 陈祎. 县级财政负担与地方公共服务:农村税费改革的影响[J]. 经济学(季刊), 2015, 14(2):417-434. ZHOU L A, CHEN Y. Local fiscal burden and public good provision:Impact of rural tax-for-fee reform[J]. China Economic Quarterly, 2015, 14(2):417-434. (in Chinese)
[9] 刘克崮, 贾康. 中国财税改革三十年:亲历与回顾[M]. 北京:经济科学出版社, 2008. LIU K G, JIA K. Thirty years' experience and review of China's fiscal and tax reform[M]. Beijing:Economic Science Press, 2008. (in Chinese)
[10] 毛捷, 吕冰洋, 陈佩霞. 分税的事实:度量中国县级财政分权的数据基础[J]. 经济学(季刊), 2018, 17(2):499-526. MAO J, LV B Y, CHEN P X. Facts of tax sharing:Data basis for measuring county-level fiscal decentralization in China[J]. China Economic Quarterly, 2018, 17(2):499-526. (in Chinese)
[11] AUTOR D H. Outsourcing at will:The contribution of unjust dismissal doctrine to the growth of employment outsourcing[J]. Journal of Labor Economics, 2003, 21(1):1-42.
[12] FUEST C, PEICHL A, SIEGLOCH S. Do higher corporate taxes reduce wages? Micro evidence from Germany[J]. American Economic Review, 2018, 108(2):393-418.
[13] BESLEY T, SMART M. Fiscal restraints and voter welfare[J]. Journal of Public Economics, 2007, 91(3-4):755-773.
[14] ROSS M L. Does taxation lead to representation?[J]. British Journal of Political Science, 2004, 34(2):229-249.
[15] 范子英, 张军. 粘纸效应:对地方政府规模膨胀的一种解释[J]. 中国工业经济, 2010(12):5-15. FAN Z Y, ZHANG J. Flypaper effect:An explanation to the expanding of local governments' size[J]. China Industrial Economics, 2010(12):5-15. (in Chinese)
[16] 尹恒, 朱虹. 县级财政生产性支出偏向研究[J]. 中国社会科学, 2011(1):88-101, 222. YIN H, ZHU H. A study of productive expenditure bias in county-level finance in China[J]. Social Sciences in China, 2011(1):88-101, 222. (in Chinese)
[17] GADENNE L. Tax me, but spend wisely? Sources of public finance and government accountability[J]. American Economic Journal:Applied Economics, 2017, 9(1):274-314.
[18] 傅勇, 张晏. 中国式分权与财政支出结构偏向:为增长而竞争的代价[J]. 管理世界, 2007(3):4-12, 22. FU Y, ZHANG Y. Chinese style decentralization and local government's expenditure bias:A cost of competition for growth[J]. Management World, 2007(3):4-12, 22. (in Chinese)
[19] 龚锋, 卢洪友. 公共支出结构、偏好匹配与财政分权[J]. 管理世界, 2009(1):10-21. GONG F, LU H Y. The structure of public spending, the preference-matching and the fiscal decentralization[J]. Management World, 2009(1):10-21. (in Chinese) |
|
Viewed |
|
|
|
Full text
|
|
|
|
|
Abstract
|
|
|
|
|
Cited |
|
|
|
|
| |
Shared |
|
|
|
|
| |
Discussed |
|
|
|
|
2019,
Vol. 59
