Research On The Influence Of Local Fiscal Pressure On High-Quality Economic Development

High-quality economic development is an important content of Xi Jinping’s Economic Thought on Socialism with Chinese Characteristics for a New Era,which has achieved major innovation in the concept dimension,means dimension and strategic dimension.The core value orientation of high-quality economic development embodies quality and development.In the Chinese context,the adjustment of fiscal decentralization system objectively leads to the increase of local financial pressure,which has a profound impact on the mode and path of China’s economic development.By 2022,under the background of tax and fee reform,with the VAT reduction as the main task and the reduction of income tax,government charges and social insurance premiums,the proactive fiscal policy will continue to make great efforts.As a result,the growth rate of local fiscal revenue has slowed down,while the rigid growth of people’s livelihood fiscal expenditure makes local fiscal revenue and expenditure face the pressure test of tightening,which has a certain impact on the highquality development of China’s economy.Based on the above background,the thesis tries to answer the following questions on the basis of previous studies: How does local fiscal pressure affect high-quality economic development? Will it stimulate or inhibit high-quality economic development? What are the problems of local fiscal pressure affecting high-quality economic development? How to avoid the negative effects of local financial pressure and make high-quality economic development more sustainable? Based on this,the thesis analyzes the impact of local financial pressure on high-quality economic development from multiple perspectives and levels.The main contents are as follows: First,with the help of the new fiscal governance theory,the development theory of a big country and the political economy theory of socialism with Chinese characteristics and other basic theories,to build an analytical framework of the impact of local fiscal pressure on high-quality economic development.Second,the thesis sorts out the evolution of local financial pressure since China’s reform and opening up,describes and analyzes the basic status quo of local financial pressure,and points out the main causes of the existence and intensification of local financial pressure at the present stage.Thirdly,on the basis of clarifying the context of high-quality economic development,a comprehensive index system is constructed to measure the quality of economic development,and the high-quality economic development index of various provinces and cities in China is measured,and the differences between regions in highquality economic development are described and analyzed.Fourthly,empirical analysis method is used to test the effect of local fiscal pressure on high-quality economic development.The actual effect of local fiscal pressure on high-quality economic development under regional heterogeneity,dimension heterogeneity,pressure heterogeneity and economic level heterogeneity is investigated respectively,and then the intermediary effect model is used.The connotative development path of "local fiscal pressure--tax effort(fiscal expenditure structure and local government debt)--high-quality economic development" is empirically tested.Fifthly,based on the main research conclusions of the thesis,relevant policy suggestions are put forward to alleviate local financial pressure and promote high-quality economic development.Through the above studies,the main conclusions of the thesis are as follows:First,the historical evolution and current situation analysis of local financial pressure:from 1978 to 2020,the change trend of local financial pressure is "small,initial,first stable,then increase,continue to intensify,at the same time,various provinces and cities where income gap increase,per capita fiscal balance gradually expanded,the local financial revenue and expenditure gap accounted for the proportion of fiscal spending continues to rise,suggests that local financial imbalances problem is more serious in China,the reasons can be summarized as economic growth is slowing,continue to cut taxes and fees and fiscal expenditure rigidity between growth and central to the governance and expenditure responsibility does not match.Second,the index measurement of high-quality economic development: Starting from five dimensions of innovation dimension,coordination dimension,green dimension,open dimension and sharing dimension,a comprehensive index system of high-quality economic development of 30 provinces and cities(except Hong Kong,Macao,Taiwan and Tibet Autonomous Region)was constructed based on 27 classification indexes,and entropy weight method was selected as the weighting method.The results show that the overall quality of economic development index from 2012 to 2019 still has a large space for improvement.From each dimension,the 30 provinces and cities show a good development trend in innovation dimension and sharing dimension.The development index of coordination dimension and green dimension fluctuates greatly and decreases slightly,while the development index of open dimension decreases significantly.In addition,the highquality economic development shows obvious regional heterogeneity.Except for the coordination index,the total index and other four dimension indexes decrease successively from east to west.Third,the empirical analysis of the impact of local fiscal pressure on high-quality economic development: Using the data from 2012 to 2019 and under the condition of controlling regional and time variables,the two-way fixed effect model is used to regression and it is found that there is an inverted U-shaped relationship between the impact of local fiscal pressure on high-quality economic development.In the current stage,the former has a positive effect on the latter,but when the financial pressure is greater than the critical point,its marginal impact on the quality of economic development will turn from positive to negative.Specifically,at present,some provinces and cities have been in a stage where the greater the financial pressure,the lower the quality of economic development,and the negative impact of local financial pressure on the quality of economic development of the jurisdiction has gradually emerged.Based on the heterogeneity analysis of region,dimension,financial pressure level and economic development level,the positive effect of local financial pressure on high-quality economic development is significant in the east and central regions.Local fiscal pressure has an incentive effect on the high-quality development of innovation dimension,open dimension and sharing dimension,but has no effect on coordination dimension and green dimension.Only moderate local fiscal pressure can promote high-quality economic development;The effect of local financial pressure on promoting high-quality economic development is only significant in the regions with high level of economic development.Fourthly,the mechanism analysis of local fiscal pressure affecting high-quality economic development: In general,the moderate increase of local fiscal pressure can promote high-quality regional economic development through improving local government tax revenue,optimizing fiscal expenditure structure and stabilizing local government debt.That is,there is a significant connotative growth path of "moderate increase of local fiscal pressure → efforts to improve tax revenue(optimization of fiscal expenditure structure and sustainable local government debt)→ promotion of high-quality economic development".The results show that accelerating the reform of tax system structure,improving the intensity of tax collection,optimizing the structure of fiscal expenditure,improving the development of "people’s livelihood finance" and appropriate borrowing constitute important mediating factors of promoting high-quality economic development under local fiscal pressure.Based on the above research results,the thesis puts forward policy suggestions to effectively relieve local financial pressure and promote high-quality economic development:First,strengthen policy support and increase financial support,improve the intensity of tax efforts,strengthen tax collection and administration;We will deepen reform of the tax system and gradually increase the proportion of direct taxes and continued to use fiscal policy to foster new sources of growth and support high-quality economic development;Second,we need to improve the structure of spending to make it more capable of ensuring social security,and increase the quality and efficiency of government spending,effectively break the rigid dilemma of expenditure;We will improve the fiscal relationship between the central and local governments and properly divide fiscal powers,administrative powers and expenditure responsibilities and deepen reform of the system for managing budgetary expenditures,effectively improve the efficiency with which government funds are used,and boost high-quality economic development;Third,strengthen risk prevention and control to enhance fiscal sustainability,strengthen management of local government debt,and prevent and control hidden risks of local governments.We will improve the performance system for local government debt and use government debt funds more efficiently and deepen debt oversight mechanisms,strengthen governance over local government debt,and boost highquality economic development.Compared with existing studies,the innovation of the thesis lies in: First,it is of urgent practical significance to respond to the long-term goals of China’s "14th Five-Year Plan" and based on the specific perspective of local financial pressure,to study the actual effect of increasing local financial pressure on high-quality economic development,so as to provide policy suggestions for alleviating local government financial pressure and promoting highquality economic development.In accordance with the goals and requirements of China’s "14th Five-Year Plan",the strategic plan for high-quality development and the new development concept,based on the dimensions of innovation,coordination,green,openness and sharing,the thesis constructs a comprehensive index system to measure the quality of economic development,and investigates the current situation of high-quality economic development from different angles and levels;Thirdly,the thesis focuses on the analysis of the mechanism that local fiscal pressure affects high-quality economic development through improving tax revenue,optimizing fiscal expenditure structure and sustainable borrowing,and carries out an empirical test with the intermediary effect model.