A Study On Harmonizing The Supply Of Public Goods In The Urban And Rural Areas

After 30 years of reform and opening up, China's economic development has made remarkable achievements, and has entered the intermediate or advanced stage of industrialization period of transition. China's market economic reforms have greatly transformed the face of rural areas, and the size of the floating population is also expanding. However, there are still many problems in the economic and social development of China's urban and rural areas. The gap between urban and rural economic shows a marked wave-type model, and the level of urban-rural gap in the supply of public goods is also growing. Since the Sixteenth Congress, the CPC Central Committee put forward the strategic plan for the co-ordinate urban and rural development, and building a harmonious society. China's central government has abolished agricultural taxes and steadily increased its investment in rural infrastructure, and significantly increased agricultural subsidies and the level of public services in rural communities. But in recent years, the gap between the supply of public goods in China's urban and rural areas still did not show significant narrowing trend on the whole. So, what factors contribute to the local public goods supply's urban bias then? After the national development strategies have Shift to urban and rural development, what change the local government preference will happen? how to co-ordinate the supply of public goods in the urban and rural areas ? These issues constitute the main theme of this study.At present, with regard to urban and rural public goods' supply , the behavior of local government official has been treated as the assumption of maximizing economic interests, and studied under the framework of fiscal decentralization and the government in competition. However, as an agent of a political organization, the local government officials have the objective function which is different from the economic organization of the agents. They seek to maximize the political status (including job promotion, retention or exchange, etc.), rather than the purely economic maximum benefit. Thus, in combing and absorbing urban-rural integration theory, the local supply of public goods theory, and the local official incentives theory, the author introduces the concept of political support for local officials, and studies the marginal political support of local officials, and the priority order, and the behavioral biases, thus builds the political economy model of behavior choices. Next, the author explains China's urbanization process in the local officials in urban and rural public goods supply preferences, and has analyzed the urban-rural dual economic conditions, focusing on the behavior of different subjects. Finally, author sums up the domestic and international urban and rural public goods supply experience, and gives policy recommendations. The main conclusions of papers are:First, In China before the implementation of urban and rural development strategy, local officials in order to obtain maximum political support, its rational choice is to implement the urban bias of public goods supply policy, which led to the level of China's urban and rural areas pose a huge gap .Secondly, as the chance of preference to the development of the central government, the increase in the supply of public goods in rural areas will enable local officials to obtain significant increase political support for higher levels of government. So, local officials will eventually abandon the urban bias of public goods supply policy, turn to supply the public goods equally among urban and rural areas. However, the policy of urban and rural public goods supplying may occur complex evolution in the future.Thirdly, under our urban and rural development strategy, short-term objective of urban and rural public goods supply should be to encourage local officials to increase the supply of public goods in rural areas, medium-term objective should be to improve the local officials' public product supply capacity, long-term goal should be to encourage local officials to step up institutional innovation.