Abstract
Research has shown that the centralization of financial power in unitary states is not conducive to local governments' promotion of e-government, resulting in the expansion of local fiscal deficits. The fundamental reason for this problem lies in the contradiction between the information disclosure required for effective e-government and the information concentration characteristic of unitary countries. To identify the impact of e-government on fiscal deficits in this context, we take two e-government pilot projects in China as quasi-natural experiments and conduct difference-in-differences analysis of county-level data from 1997 to 2018. Through a common trend test, a placebo test, a lagged outcome variable design and the difference-in-differences with propensity score matching method, we validate our finding that e-government can effectively reduce the fiscal deficit of local governments. This function is mainly realized through the application of media tools and expansion of the scale of local enterprises. However, the impact of e-government on fiscal deficit differs significantly between regions with different levels of economic development. The effect is more obvious in regions with a poorer economic foundation. Our findings indicate the importance of e-government construction in unitary developing countries.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.