Research On The Optimal Configuration Of Crossing Decision-making Authorities Between The Central And Local Government

Demarcating Decision-making authorities between governments scientifically is an important but a difficult issue, which decides the fiscal revenues and expenditures of governments, and the Fiscal Transfer System.The thesis discusses the optimal configuration of crossing decision-making authorities, establishes the Principal-Agent model, the Supervision and Encouragement model and the In-Out model. Then, it puts forward establishing suitable fiscal relations between the central and local governments. At last, it summarizes the contents of the thesis, and brings up the problems to be further solved and research direction.In the model of Principle-Agent, the thesis uses probability restrictions instead of participation restrictions, and considers the divergence of the two sides on natural conditions. According to the model, during the decentralization, the central government should communicate with local governments, to form a relatively unanimous expectation.The thesis establishes a Supervision and Encouragement model: Viewing results of local government behaviors, is to infer their conditional expectation, which can be taken as the basis of the encouragement contract and supervision.In the In-Out model, the thesis uses Cobb-Douglas production function, takes fiscal expenditures of central and local governments as investment parameters, and gets the optimal decentralization index by making the provision of public goods most.