Research On Establishment Of Horizontal Transfer Payment System In China

Since Reform and Opening up, our economic have developed rapidly, and people's living standards and comprehensive national strength have rapidly increased too. However, at the same time, the widening income gap and unbalanced regional economic development become more and more serious. Due to geographical advantages and other reasons, the development of the eastern region is much faster than the central and western regions, and as a result of this development gap, the financial capacity and public service level is very different in different regions, which leads to a further development gap. This is a vicious circle. The existence of this phenomenon has become a great threat to the further development of our economy and harmonious society.Therefore, in the current situation, it is very necessary to take effective policy means to gradually narrow the development gap between different regions.Financial transfer payment, which can be divided into horizontal and vertical transfer payment according to the direction of capital flows, is the transfer of financial resources between goverments.In the world, financial transfer payment, especially horizontal transfer payment, plays an important role in narrowing regional development gap. However, now in our country, there is only vertical transfer payment, and horizontal transfer payment is still in research stage. Because of its' own defeat, the current vertical transfer payment system is fail in narrowing the development gap. Therefore, in order to improve our financial transfer payment system, and gradually narrow the development gap between different regions, this paper puts forward its own policy recommendations on establishing horizontal transfer payment system in our country. The article includes five parts:The first part is the introduction. This part describes the background and significance of this topic, the current research literature on the topic at home and abroad,the paper's structure and the innovation and less of this article.The second part is theoretical analysis. This part first introduces the concept and form of horizontal transfer payment, and then describes the theoretical basis of horizontal transfer payment, including Public Finance Theory, Externality Theory and Game Theory. Finally, this part describes the short-term effects and long-term effects of establishing horizontal transfer payment system.The third part is the reality inspection. In this part, the paper first analyzes the necessity and feasibility of establishing horizontal transfer payment system in China, and then introduces the main constraints.The fourth part is foreign experience. In this part, the paper gives some experiences of establishing horizontal transfer payment system in our country, on the basis of analyzing typical transfer payment system in Germany, Australia and Canada.In the last part, the paper puts forward its own policy recommendations on establishing horizontal transfer payment system in our country, including related laws and regulations, the objectives and functions of horizontal transfer payment,the division of powers and financial resources between governments, the fund system and coordination of horizontal and vertical transfer payment system.