Abstract
The fiscal decentralization gives the local government economic participation status. Is there a spatial spillover effect in the process of local government financial expenditure? This paper introduces the spatial econometric model, and applies the 2005-2016 data to test the spatial correlation of the whole country by calculating the Moran’s I index and the Geary index C. At the same time, we use the local Moran’s index to detect the degree of agglomeration between regions. The results show that there is a significant spatial spillover effect between regions. There are policy imitation behaviors in the region and adjacent areas, and there is a high value and high value agglomeration among regions, as well as a trend of low value and low value agglomeration.
Highlights
IntroductionWhether there is a competition between Chinese governments on fiscal expenditure? Tax competition has always been the main means of fiscal competition, but with the change of society and the development of time, the preferential tax policy has shifted from region to industry, and the means of local fiscal competition have gradually shifted to the field of expenditure competition, which provides public goods and services [1]
Is there a spatial spillover effect in the process of local government financial expenditure? This paper introduces the spatial econometric model, and applies the 2005-2016 data to test the spatial correlation of the whole country by calculating the Moran’s I index and the Geary index C
Whether there is a competition between Chinese governments on fiscal expenditure? Tax competition has always been the main means of fiscal competition, but with the change of society and the development of time, the preferential tax policy has shifted from region to industry, and the means of local fiscal competition have gradually shifted to the field of expenditure competition, which provides public goods and services [1]
Summary
Whether there is a competition between Chinese governments on fiscal expenditure? Tax competition has always been the main means of fiscal competition, but with the change of society and the development of time, the preferential tax policy has shifted from region to industry, and the means of local fiscal competition have gradually shifted to the field of expenditure competition, which provides public goods and services [1]. Different scholars have chosen different methods to verify the existence of financial expenditure competition and test the effects of financial expenditure competition. Wang behavior of fiscal expenditure strategy which applies spatial econometric model regards that the expenditure of economic construction and maintenance expenditure is not conducive to the growth of economic construction and social expenditure competition has positive effect on economic growth [2]. Scholars make further research on the effect of fiscal expenditure competition on provincial capital flows and consider that in the field of social and livelihood, fiscal expenditure competition can have an effect on capital inflows [6]. Some scholars further detect the invalidity of fiscal expenditure competition that there is U linear relationship between fiscal expenditure competition and economic growth and excessive competition is not favorable for economic growth
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